asked Her Majesty’s Government:

What measures they are taking to ensure that there is no postal fraud in the forthcoming local elections.

My Lords, the Government take very seriously the integrity of the electoral process. We have introduced a number of measures to tighten up the security of the electoral system, which will be in place at the forthcoming May elections. We also support the work of the Association of Chief Police Officers and the Electoral Commission in preparing for those elections updated guidance on preventing and detecting electoral malpractice.

My Lords, I thank the Minister for that Answer, but is he aware that the Council of Europe reported in January of this year that the household postal vote on demand was open to fraud and urged that changes be made to the postal system and to registration? Is he further aware that it was judicially decided last month that it is childishly simple by corrupt practices to opt out of or bypass— that was the word used—the Act? In those circumstances, what do the Government intend to do to protect the May elections? If they are not prepared to take any steps, will they consider implementing the recommendations of the Electoral Commission in its booklet of January 2007 posted on its website?

My Lords, that was a very extensive question. Of course I am aware of the Slough case and of the Conservative councillor who was found against, and of the Council of Europe committee’s deliberations. It is fair to say that, although it identified some challenges that we face, it also made it absolutely clear that UK elections are conducted democratically and represent the free expression of the will of the people.

Changes have been made to the system to provide more checks. I was present at the launch of the guidance given by the Electoral Commission and the Association of Chief Police Officers. There is very clear guidance to returning officers about electoral integrity and advice for polling staff about maintaining integrity during the voting process. Of course, we will keep that closely under review, but the changes made to the postal voting system are to encourage more people in this country to vote. Surely that is an aim that we all share.

My Lords, is it not the difficult and unpalatable truth that much of this fraud is centred on the ethnic minority communities? With that in mind, is it not quite wrong to proceed with more and more draconian regulations and controls? Should we not concentrate our efforts on dealing with the problem precisely where it exists and not in this very widespread way?

My Lords, if one looks at the record, it is clear that, overall, we have a system of which we can be proud. There are areas where there has been fraud, some of which may well have included people of different ethnic backgrounds. The best way forward is for the Electoral Commission to continue its work of giving general guidance and target its efforts where the appropriate information is available.

My Lords, the Minister said that a number of steps are already planned. Is one of those steps to ensure that people cannot knock on the doors of lonely and frightened old people, take away their postal votes and tell them that they will fill in the forms for them? There was much evidence of that in Birmingham and it is very worrying.

My Lords, the noble Baroness will know that there has been concern about a number of cases in Birmingham, the latest of which was reported yesterday. The issue of party workers handling postal votes, to which I think the noble Baroness is referring, was discussed during the passage of the Electoral Administration Act 2006. Although agreement was not given to legislation, a national code of conduct for political parties was developed. I do not want to read out all of it but I shall make it available to the noble Baroness. It makes it clear that you—candidates and party workers—should not touch or handle anyone else’s ballot paper.

My Lords, does my noble friend agree that a crucial part of the integrity of elections on election day is related to the mechanism of the electoral system that is employed? Does he further agree that evidence from the recent report shows that there are tremendous advantages in the merits, quality and integrity of the first-past-the-post system which the Government and everyone else should recognise?

My Lords, the excellent report to which my noble friend refers is widely admired because it provides evidence for any voting system you care to support.

My Lords, does the Minister accept that the vast majority of crime in this country is unreported—and therefore not prosecuted—and that the recent scandals of postal vote abuse in places such as Birmingham and Slough may be only the tip of the iceberg? Does he not now accept that we should either follow the advice of the Electoral Commission and the Committee on Standards in Public Life that we should have individual voter registration in this country, or that we need to abandon postal voting on demand and consider other methods of boosting voter turnout, such as voting at weekends?

My Lords, the noble Lord will know that the issue of voting at weekends is being considered. I do not agree with his general point that it is the “tip of the iceberg”. Noble Lords have commented on worrying cases but, overall, we can be confident in the integrity of the system. As to individual registration, I agree that it might offer a way forward but the risk is that it could lead to under-registration. Ultimately, we want to see registered everyone who ought to be registered, and voter turn out as high as possible, but if individual registration leads to under-registration and under-voting, we would be cautious about going down that route.

asked Her Majesty’s Government:

What progress they have made in introducing neighbourhood policing teams into every community in England and Wales.

My Lords, the government commitment to a neighbourhood policing team in every area by April 2008 has been met. For the first time ever, every household across England and Wales will have a dedicated police team to solve local problems. This marks three years of hard work by police forces and police authorities to roll out neighbourhood policing.

My Lords, I thank the Minister for that response. Does he accept that many of us in this House who have worked in communities have long held the view that you can have safer communities only with community policing, and thus welcome this initiative? Matt Baggott, chief constable of Leicestershire, the lead on ACPO’s neighbourhood policing initiative, has also welcomed it. However, what guarantees do we have that the community policing teams will feed back to the communities and not to the officials in the local authorities who will not necessarily give the information back? What guarantee do we have on budgets? Most importantly, what access outside what I call “office hours”—9 am to 5 pm—will the local community have to these police community teams?

My Lords, my noble friend raises some important points. On the funding side we have a good story to tell, at present and into the future. We have spent about £700 million since 2002 on this initiative. For 2008-09 we have had a good settlement from the CSR: £324 million will be used, £288 million of which is for PCSOs. We are going to continue funding at 50 per cent for the PCSOs who were recruited before the Neighbourhood Policing Fund was launched, and at 75 per cent thereafter. For example, last year we increased funding by 41 per cent.

With regard to feedback, I was in Cambridgeshire on Monday—in the city of Cambridge, in fact—talking about neighbourhood police and going out on to the streets with them. My noble friend is right: this initiative has made a huge difference. The liaison, the integration, the ability to pass information backwards and forwards between the council, housing authorities, groups of local businessmen and the police, and the use of PCSOs, all of these are extraordinarily valuable. I think everyone would accept that it has been a huge step forward.

My Lords, I declare an interest as an ex-mayor of Cambridge. I hope the Minister enjoyed his visit. Does he agree that Crimestoppers does not know any closing hours?

My Lords, I have talked with the noble Baroness before on the Floor of the House about Crimestoppers. It is an extremely useful organisation, which is indeed open all hours. I did not really answer my noble friend’s point on the 24/7 issue; I forgot that one. There are times of the day when the community support teams are not available, but out of hours there are contact numbers that can be phoned and police response teams are always available.

I very much enjoyed my time in Cambridge. I talked to one of the PCSOs and discovered that, like many of them, he was a local man. I said, “You therefore know all the scallywags”—not that I am insinuating that anyone from Cambridge is a scallywag—and he said, “Yes, Minister, I was a scallywag”. That is one of the strengths of this initiative: we are engaging the community in that way.

My Lords, does my noble friend agree that we are not talking simply about anti-social behaviour but about serious matters, such as terrorism? Communities defeat terrorism. Neighbourhood policing is an integral part of the fight against terrorism, and if we get that right we will succeed. Does the Minister agree with that?

My Lords, my noble friend makes a good point. He is right. Of course, my prime interest is in the area of counterterrorism and security, and the NPIA and OSCT within the Home Office are looking at developing the contribution that neighbourhood policing will make to terrorism. It will have a big impact because the way to stop extremism is out there in the communities. I know all noble Lords agree with that, and we are looking at how we can take it forward.

My Lords, I am glad that the Minister feels confident about the financing, but how does he think the five police authorities whose communities wanted to spend more on policing, but which the Government chose to cap, feel? What message does it send out if communities choose to spend more on policing and the Government then decide to the contrary, given that that adds the expense of council tax bills being sent out again, so that money is going on council tax bills and not policing?

My Lords, the noble Baroness raises an important point. Police authorities are the exactly same as local authorities: the same rules and procedures apply to them. There are seven authorities. It looks as though they are in the frame for capping; I do not know how many will finally be capped. However, they have benefited from a decade of sustained funding increase and the overall government grant to police authorities will increase by 2.9 per cent for 2008-09, which is above the rate of inflation.

My Lords, bearing in mind the previous Question, what advice is being given to neighbourhood policing teams about electoral fraud?

My Lords, I do not know a great deal about this, but I think that they are given advice by the Electoral Commission. If I am wrong on that, I will come back to the noble Lord in writing, if I may.

My Lords, is the Minister satisfied that the police support officers’ current holding powers, which are no more than those of a citizen’s arrest, are sufficient? Will he consider whether they should be given full powers of arrest?

My Lords, there has been a lot of discussion about PCSOs and their powers and capabilities. They are an adjunct to the police. Their job is not actually to arrest people and take them to the police station, because then they would not be spending their time in building up community cohesion and problem solving. They are there to stop crime happening in the first place—the real achievement—by co-ordinating across the community. At the moment we think that they are extremely successful. They are supported across the country and there is huge support everywhere I have been. They are doing a very important job. At the moment I do not think that we would look at increasing those powers.

My Lords, one of the exciting aspects of community policing is the recruitment of people from ethnic minorities, who are now going into mainstream policing. Has the Minister worked out the economic impact of such people reducing crime in this country?

My Lords, the noble Lord raises an interesting point. I have to say that I have not considered the point in great detail but I share his view on the importance of recruiting people from across all of our population. The fact that they represent the local community is one of their great strengths. They are, as I said, raising issues with businesses, with the community and with councils. I have heard of a number of cases of potential crimes that were resolved beforehand, making the community safer.

asked Her Majesty’s Government:

What plans they have to promote the use of health navigators to tackle health inequality, as proposed in the Turning Point report A Personal Approach to Public Services.

My Lords, we welcome Turning Point’s report and its contribution to the discussion on personalisation of public services. We are already making lifestyle advice and support on health issues available to individuals through NHS LifeCheck and health trainers. Tackling health inequalities is a top priority and we have the most comprehensive programme ever in this country to address them. We will be strengthening this by publishing a long-term health inequalities strategy later this year.

My Lords, I thank the Minister for that reply, but I stress the needs of people who have multiple conditions. Often, they have very many conditions, including long-term asthma and problems of that sort. Those who come from a particular community may also have language difficulties and therefore a problem knowing how to navigate in order to get the services that they need, be they health, social care or anything else. What additional support will be given to such people as individuals, which I believe the health advisers do not do? That would be invaluable in combating health inequalities.

My Lords, information is indeed important. Asthma UK is advocating the use of health navigators. That is a good example of the way in which health navigators, or indeed the health trainers, can provide information not only, in this case, on the use of inhalers but on help with paying prescription charges and on support in taking time off work to accompany children to their appointments. They can help people to negotiate a route through the complex maze of services to allow them to tailor those services to best meet their lifestyles and their needs.

My Lords, I am sorry—I have completely frozen.

My Lords, will the Minister define for the benefit of the House the intention behind, and role to be filled by, a health navigator? Will she say who is now doing the equivalent work?

My Lords, a health navigator, as defined in the Turning Point report, has deep knowledge and generic skills to understand the system across healthcare, benefits, housing and criminal justice. We are providing health trainers at a local level, while the provision of health navigators is being discussed. Health trainers are working with local, often hard-to-reach communities. Twelve hundred of them are in post already. Their job is to work across those communities, providing support, signposting to local services and advice on diets, smoking cessation, exercise and issues of mental health.

My Lords, does my noble friend the Minister agree that the Turning Point report in its call for the personalisation of services in the future sets a fundamental challenge for public services in their organisation and professionalism? Does she welcome the Prime Minister’s strong endorsement of this approach and of making progressive change in this way?

My Lords, that is absolutely right. Implementing personalisation of services across the boundaries of social care, housing, benefits, leisure, transport and health, with partners across independent, voluntary and community organisations, is vital. The report of my noble friend Lord Darzi recognises the relationship between health, social care and wider communities, which will be integral to the creation of a truly personalised healthcare system.

My Lords, so that these health navigators do not become like the sat-nav in my car and cause more confusion—I am obviously a little confused myself this morning—as people try to find their way through health and social services, will the Minister tell us a little about the pilot schemes that have been operating, whether they will be evaluated and whether that evaluation will be made public, so that we can see for ourselves the results of those schemes? In the light of the report on community pharmacists this morning, might they, too, have these health navigators on their premises, which seem to be the most accessible point for most patients?

My Lords, as the noble Baroness has clearly illustrated, several discussions are taking place about health navigators and health trainers. The health trainer system already exists, is being evaluated and is already delivering. For example, a former miner in Bolsover is working with the Bolsover Wellness scheme, which supports individuals and families, including people with diabetes and heart disease, across his own community. He is from that community and understands it; he follows the progress of those people; he is building his expertise and supporting the health needs of that community. The scheme is very practical and is being evaluated. One hopes that it will continue to be rolled out.

My Lords, will the noble Baroness accept that, some 25 years ago, the late Sir Douglas Black produced a comprehensive report on inequalities in health, the recommendations in which were rejected by the then Conservative Government?

No, that is quite wrong.

Well, my Lords, many of the recommendations were rejected. Ten years ago, the former government Chief Medical Officer, Sir Donald Acheson, produced another report on inequalities in health, which in turn resulted in very few positive developments. May we be reassured by the noble Baroness that this important report and its recommendations will not suffer the same fate?

My Lords, my right honourable friend the Secretary of State, Alan Johnson, has confirmed that tackling health inequalities is central to the department’s work. The current national inequalities targets run till 2010. We are publishing a strategy this year which will draw on those reports. This is absolutely a priority.

My Lords, in looking at health inequalities, should not the Government have as one of their first priorities a review of the resource allocation formula? For example, spending on cancer in Oxfordshire is £5,182 per head, while cancer patients in Nottingham receive £17,028 per head. Does the Minister think that that large difference in funding is purely and simply a reflection of the burden of disease, or might there be something wrong with the formula?

My Lords, the incidence of cancer deaths—the second biggest cause of the inequality gap—is linked to geographic areas. In the areas of highest deprivation there is late presentation, and the investment has to go into the care in those areas.

asked Her Majesty’s Government:

What is their response to reports that the French nuclear safety watchdog ASN has identified safety weaknesses relating to nuclear reactors of the type France hopes to sell to the United Kingdom.

My Lords, the Government’s view is that the French nuclear regulator has rightly carried out its functions following the inspection of the nuclear power station being constructed in Flamanville by EDF by drawing the attention of the operator to the necessary areas of action. We also note that the regulator raised issues about the construction procedures at the site and not about the design of the reactor itself.

My Lords, I am grateful to the Minister for that Answer. According to the NII, the migration of skills has placed a severe strain on its ability to find, train and retain the number of skilled employees it needs to assess the different types of reactor for which licences are being sought. What are the Government doing to address that?

My Lords, the Nuclear Installation Inspectorate is currently undertaking a recruitment campaign and has received a number of applications for the vacancies that it foresees in the next two to three years. The Treasury has allowed a 15 per cent pay flexibility in order to assist it.

My Lords, are there enough nuclear safety inspectors to act in Smart procurement? We are talking about major problems at the reactor at Flamanville in Normandy which could adversely affect the cost of any new nuclear build.

My Lords, the function of the UK regulators is to assess the regulatory environment and the safety security environment, not procurement. The procurement will be undertaken by whichever utility companies express an interest and get the right licences. That is a matter for the private sector developers of nuclear.

My Lords, does the noble Baroness recollect the joint communiqué issued between the Prime Minister and President Sarkozy at the end of March? It stated that the two countries would aim to,

“improve the efficiency and effectiveness of nuclear development projects, including in safety and pre-licensing”.

Indeed, the Secretary of State, Mr Hutton, met the French energy Minister,

“to discuss how the UK can work more closely with France on civil nuclear issues—in particular how our two nuclear regulators can work closely together to enhance the efficiency and effectiveness of the reactor design licensing process”.

Is it hoped that this may lead to the regulators recognising each other’s generic design assessments?

My Lords, the recognition of generic design assessment is undertaken by the Nuclear Installation Inspectorate and must remain a national responsibility. The agreement that is referred to is an agreement on the sharing of information, exchange of experts and increasing of secondments in order to make both national regulators more effective. There is also further co-operation between Governments on issues around skills, waste and research.

My Lords, there seems to be a single market in practically everything else; why not in the nuclear industry?

My Lords, there is a global market in the nuclear industry. The last sizeable reactor was built in France with Japanese components and American technology, so it is a global market.

My Lords, how many people currently working in the British nuclear industry speak French?

My Lords, I would offer to write if I thought that that information was available, but I do not think that it is.

My Lords, with the permission of the House, my noble friend Lord Malloch-Brown will repeat a Statement on Zimbabwe after the first debate.

rose to move, That the first report from the Select Committee be agreed to. (HL Paper 63).

The report can be found at the following address: http://www.publications.parliament.uk/pa/ld200708/ldselect/ldprohse/63/63.pdf

The noble Lord said: My Lords, I beg to move the Motion standing in my name on the Order Paper. The report recommends the trial adoption of a new procedure for Law Commission Bills. This procedure was proposed by the Leader of the House, following commitments that she made during the passage of the Legislative and Regulatory Reform Act 2006. She has also discussed the procedure with colleagues across government.

The aim of the Law Commission, as noble Lords will be aware, is to ensure that the law is as fair, modern, simple and cost-effective as possible. To this end, it regularly publishes reports with draft Bills, most of which, although not all, are technical and uncontroversial. Unfortunately, the pressure of time means that the implementation of Law Commission Bills has not kept pace with their production. The new procedure, which is described in full in the report, will, we hope, help to clear the backlog. Once the procedure has been tried out on no more than two suitably uncontroversial Bills, the committee will review how it has worked and make final recommendations accordingly.

Moved, That the first report from the Select Committee be agreed to (HL Paper 63).—(The Chairman of Committees.)

My Lords, I have been a great admirer of the work of the Law Commission ever since it was created by the late Gerald Gardiner, the then Lord Chancellor in the first Harold Wilson Government. Since then, it has added many achievements to its name. As the Chairman of Committees said, most of them are minor and technical, but some are of considerable importance, such as the Land Registration Act.

There is a problem of delay because of the difficulty of getting Law Commission Acts on to the agenda for Parliament. Ministers do not like spending time on that. The noble and learned Lord, Lord Irvine of Lairg, was particularly helpful in this matter as Lord Chancellor, but not all others have been equally helpful. The result is that far too many Law Commission projects have remained on the shelf for far too long. During the passage of the Legislative and Regulatory Reform Act 2006, the noble Baroness, Lady Ashton of Upholland, who is now Leader of the House, worked very hard to try to achieve an alternative method for dealing with Law Commission Bills that would reduce the amount of time that they spent on the Floor of the House and therefore make it easer to deal with them. The noble Baroness hoped at the time to be able to produce something that would come out at the same time as the Bill was enacted. Unfortunately, she failed to do this, but she kept at it in the following two years and, despite the fact that she has now risen to much greater heights and a much more demanding job, she has now succeeded.

We now have a pilot scheme, which we should all welcome. I am sure that my party does. I am also sure that Mr Justice Etherton and the members of the Law Commission will also welcome it. I hope that it is a great success and will enable Law Commission Bills to pass much more quickly.

My Lords, I too warmly welcome the report. Lord Gardiner, whom the noble Lord, Lord Goodhart, mentioned, was a great believer in law reform. He attached great importance to it. He believed that it should be carried out systematically and not left to chance. The Law Commission has always had the most distinguished membership since its first chairman, Lord Scarman.

The Law Commission has published a long series of reports, of which we have heard and all of which are of the highest quality. To some extent, it can be said that they have been a victim of their own success, because Parliament, for its part, has not found the time to implement the reports, or even in some cases, I fear, to consider them. This inevitably has been frustrating for the Law Commission, but more important still, it has been bad for law reform. What is now proposed is, to my mind, a great improvement. It will give Law Commission Bills a much higher profile, which is important. In due course, it may be possible to refine the procedure still further, but in the mean time, I hope that the trial period for which this scheme will run will prove to be a great success.

I add my thanks to the Leader of the House and congratulate her on fulfilling the commitment that she gave in 2006. Governments do not always fulfil their commitments, but in this case the Leader of the House has done so. She has proved to be a good friend to law reform.

My Lords, I declare an interest and make what is, I hope, a constructive suggestion. My brother was chairman of the Law Commission in the 1990s and found that the time invested in talking in-depth to the shadow Attorney General—then Mr Boateng, who is now our High Commissioner in South Africa—was extremely productive in reducing the misgivings of the Opposition about that legislation coming forward.

My Lords, I always learn something new when I listen to my noble friend Lord Brooke.

I add my support to this initiative. There was an earlier attempt in the mid-1990s, within the framework of the so-called Jellicoe committees, to introduce a similar initiative. Unfortunately, it foundered because we were rather overambitious and introduced Bills which had an element of controversy in them. The key to the new procedure is to ensure that only Bills that are not politically controversial are allowed to run through the mechanism.

The noble Baroness, as both the noble and learned Lord, Lord Lloyd, and the noble Lord, Lord Goodhart, have said, has been infinitely patient in constructing this procedure. There have been moments when one thought the whole initiative would collapse. With her remarkable blend of dextrous adroitness—if I can express it in that way—the noble Baroness has achieved something quite procedurally remarkable. We are all very much in her debt.

My Lords, I confirm what my noble friend Lord Goodhart has said: this has the strong support of these Benches. The noble Lord, Lord Brooke, made a very wise intervention. This pilot scheme will work best and be carried forward if the Opposition parties are fully involved and if it is used genuinely to break this log jam and agree non-controversial measures. That was very wise advice from the noble Lord, Lord Brooke.

My Lords, I shall briefly say two things. First, I agree completely with the noble Lords, Lord Brooke and Lord McNally. This is absolutely designed for us to work together. These Bills are defined as non-controversial because all parties agree them to be. If noble Lords look at the procedure, there is a break all the way through it. If, at any point, controversy were to be attracted to a Bill, anyone can stop it. That is the essence of the procedure. Secondly, I thank the noble Lords who have spoken in this debate; they inspired me to keep going and, indeed, gave me the ideas. None of the ideas in this procedure is mine; they all belong to the people who have spoken in this debate.

I pay particular tribute to Lord Justice Etherton, chairman of the Law Commission, who was determined that I should not give up on this. Within 10 minutes of becoming Leader of the House, I had a text message saying, “Aha—now you can do it.” I pay enormous tribute to him; this really does belong to him. I am very grateful to noble Lords. I hope this works and that, as we take it through, noble Lords will get involved so that we can refine it. I am sure there are things we can do to make it better. If it works, it will do something quite remarkable that has long been needed.

On Question, Motion agreed to.

rose to call attention to the trend in the incidence of HIV/AIDS; and to move for Papers.

The noble Lord said: My Lords, I begin this timely and important debate by declaring my interest. I was the co-author, with two colleagues, of the first published estimate of the likely future demographic impact of HIV in Africa. I was living in the United States at the time of that study, which was then regarded by the World Health Organisation and the World Population Council as excessively pessimistic, but which, sadly, was accurate. It had much less demographic detail, but it got the transmission dynamics and epidemiology right.

As a result of that study, I was involved through the US National Academy of Sciences in its expert advisory committees, while my co-authors, Roy Anderson, who is about to succeed Richard Sykes as the Rector of Imperial College, and the third author and junior colleague, Angela McLean, who was then a graduate student and is now a professorial colleague in Oxford, were involved here with the All-Party Group on AIDS, several of whose members will speak in this debate.

We made similar recommendations on a range of pragmatic and effective things to be done, such as distributing needles among drug users who were in the habit of sharing needles, aggressive campaigns to raise awareness and so forth. In the US, all such advice was disregarded by the Reagan Administration as being morally improper, whereas in the UK, under the wise leadership of the noble Lord, Lord Fowler, and others who will speak, the recommendations were implemented. The outcome was summarised very well in a recent report from the Australian Lowy Institute; a foreign policy think tank. It states:

“Generally, countries adopting pragmatic HIV containment policies tended to secure substantially better HIV outcomes than those countries that promoted HIV/AIDS responses based on sexual abstinence, criminalisation of prostitution and zero tolerance for injecting drug use. This was certainly so in the case of Australia and the US which from the early 1980s followed highly dissimilar … AIDS containment policies. After 25 years, the per capita prevalence of HIV … in the United States is well over 10 times”,

that in Australia.

Until quite recently, you could have said, “Similarly for the United Kingdom”. But although the per capita incidence of HIV in the United Kingdom is still markedly less than in the United States, it has recently seen a notable upsurge—that is, in the number of new infections per unit time. It is an upsurge that has evoked remarkably little public attention and concern. In what follows I will first sketch that history and recent events. Secondly, I will say a few words about the causes and our uncertainties about them. Thirdly, and most importantly, I will comment on what we might do about it. In all of this, I am drawing, in a ruthlessly compressed manner, interlarded with opinionated comment, on such things as the Government’s excellent 2001 National Strategy for Sexual Health and HIV; the very recently published Health Protection Agency Testing Times—HIV and Other Sexually Transmitted Infections 2007; the European Academies Science Advisory Council recent report on the impact of migration on infectious diseases in Europe, the Lowy Institute, which I mentioned; primary research literature; and, in many ways most importantly, on a variety of reports and recommendations from UK charities and NGOs such as the National Aids Trust, the Terrence Higgins Trust, the British HIV Association and the African HIV Policy Network. I have no formal association with any of those organisations, but I am a great admirer of all of their work.

I trust that the day will never come when PowerPoint intrudes into this Chamber, but for a quick history of what has happened it would be a help. I shall attempt a verbal sketch accompanied by arm waving.

In the early days when we did not know what was happening, there was an exponential rise in the incidence of HIV and AIDS. In this country, about a third of it was in the drug-using community and some two-thirds was in the male gay community. In future, I will use the term from the technical jargon of my profession, “men who have sex with men”. Once we realised what was happening—again, under the leadership of the noble Lord, Lord Fowler, and others—the pragmatic things that were implemented saw that rise not merely halt, but come down a bit. Then, through the late 1980s and throughout the 1990s, the number of new cases each year ticked over at about 2,000 a year. There was a decline in the number of cases arising from drug use and within the men-who-have-sex-with-men community, but that was somewhat counterbalanced by a slow rise in cases in the heterosexual community. Indeed, at approximately the end of the 1990s the incidence among heterosexuals rose to exceed that among men who have sex with men.

At that time, there set in a marked rise in the number of cases among drug users—a slow reversal which still represented a small fraction of cases at much less than 10 per cent. About a third of cases were among men who have sex with men; from a decline there was a slow rise that shows no sign of turning over. In the heterosexual community, there was a really steep rise that has turned over in the past few years, but, overall, the annual incidence has roughly trebled.

I am afraid that there must be a short and inconvenient pause while I put my notes, which I have dropped, back in order.

What are the explanations for the rise? To some extent, it is the praiseworthy outcome of better testing by the Department of Health, but the statistics are very imperfect. It may be that as many as a third of people who are HIV positive remain undiagnosed. There are interesting tests which are anonymised—you ask people to provide a blood sample, but do not tell them the result. The results show some depressing things. For example, the 2007 report showed that among sub-Saharan African heterosexuals visiting genital-urinary medical clinics, of those who were HIV positive but undiagnosed when they went into the clinics, a third emerged still undiagnosed—and that is an underestimate because another anonymised study shows that people who are HIV positive are much less likely to accept the test than those who are HIV negative.

There are also indications of a general rise in sexually transmitted diseases. For example, there were some 3,000 cases of syphilis a year by 1977. The number reduced to 400 or 500 through the decade of the late 1980s and 1990s and has now increased to about 3,500. An increase in migration from sub-Saharan Africa has certainly had an impact. In roughly two-thirds of cases among black Africans the infections were probably acquired before entering the country. On top of all of that, a MORI poll conducted by the National AIDS Trust strongly suggests that lots of people are less worried, because they feel that now there are things that we can do about it—there is treatment.

So what should we be doing? I begin by observing, as Susan Sontag memorably reminded us, that illness is stigmatising, and no illness is more stigmatising than sexually transmitted disease. But our attitude has to be, both for moral and pragmatic reasons, factual. HIV is an illness; it is an illness that we can treat; and the sooner that we get infected people into treatment, the better for them, the better their prognosis, and the better for the community, because those people will be less infectious.

Therefore, the first thing we should do is ensure better screening. In my opinion—and in the opinion of the British HIV Association and of the European Academies Science Advisory Council—we should be much more proactive in screening migrants once they are admitted. However—this is something I wanted to quote and dropped—the European Academies said:

“Detection of disease on screening must not be used as a reason to deny entry to the European Union”—

the UK in particular—

“for that would deter migrants coming to screening and the identification of high-risk patients. Migrants need to be offered the same access to healthcare services as the rest of the population”.

That is right morally, it is right for the infected people and it is right for the British community, because it diminishes the spread of infection. As many charities have strongly urged, the testing should be opt-out, not opt-in.

I refer to another thing that I lost as I dropped my papers; namely, a recent study that is about to be published in a leading AIDS journal by Anne Johnson and her colleagues. It is a study of newly diagnosed HIV-positive Africans attending London HIV treatment centres between 2004 and 2006. By the time that they were diagnosed, roughly half were in an advanced state of HIV, with a CD4 count—for those familiar with it—of less than 200. However, in the year prior to diagnosis, more than three-quarters of the people in this study—76 per cent—had seen their GP and only one in seven had had their GP raise the issue of HIV, much less offer a test.

Once they have been tested, we need to treat people, we need to treat everybody and we need to treat them all for free. At present, undocumented migrants and failed asylum-seekers can be diagnosed for free, but not treated for free. Again, that is wrong morally and it is wrong pragmatically.

Thirdly—and this is perhaps trickiest—not only should we diagnose and treat, but treatment must be accompanied by counselling about safe sex and other behavioural issues. The Terrence Higgins Trust is keen on GPs carrying out testing, but is concerned that GPs currently may be reluctant to offer tests because of a widespread belief that they are then obliged to provide pre-test and post-test counselling. Interestingly, the Chief Medical Officer has responded to this—and I can understand the problem—by saying that a short pre-test explanation from the GP should suffice. That is irresponsible. The question of who should provide counselling is a complicated one, but counselling should be there for the sake of the individual and the community.

Finally, underpinning all this—I may go a minute over, because I dropped my papers—is the question of education. I have a superb quote from our own note on this subject. It says:

“HIV prevention begins with education. Misconceptions about HIV abound”.

The same MORI poll that I mentioned earlier discovered that,

“fewer people were able to identify correctly the ways in which HIV is transmitted in 2005 than in 2000 … only 46 per cent of the respondents replied they always use a condom with a new partner, and 15 per cent would ‘never’ or ‘rarely’ use one”.

With all of this outreach, it is distressing, though understandable, to learn that the £300 million allocated to sexual health by the Department of Health in 2004 was disproportionately spent on treatment rather than education; and that only 30 of 191 primary healthcare trusts spent all the money that was allocated.

Therefore, my strongest recommendation is that we need to make better use of charities in counselling, education and, indeed, testing than we currently do. The Department of Health recently gave £1 million to the African HIV Policy Network for this purpose. That is a good start but, considering the colossal sums of money that slosh around in the Department of Health, often to little effect, £1 million in this context is ridiculous. In my opinion, much more should be spent on making use of charities because they know their communities and are less process-oriented and more action-oriented than most of the primary healthcare trusts and the Department of Health.

I end by simply saying that we need to diagnose, treat and counsel, but that is for the people who are already infected. For them and everyone, we need to do a better job of educating. We need to put our foot back on the pedal. I beg to move for Papers.

My Lords, I express our thanks to the noble Lord, Lord May, for introducing this important debate in such an informative and interesting manner. I give a welcome to the small team of us who have been pushing this argument for some time. We look forward to the noble Lord joining us on other occasions.

A quarter of a century ago, we were confronted with people dying from a new virus—subsequently defined as HIV. The public health campaign launched at that time by the noble Lord, Lord Fowler, who seems to be receiving a lot of praise this morning, made sure that the whole country knew of the threat of HIV. As HIV became a managed illness, the threat to life reduced and those diagnosed with HIV could look forward to an expectancy of life. However, public awareness has not been maintained. Despite the production of the 2001 strategy and the introduction of other strategies and initiatives, people are unaware of the consequences of HIV. The question that must be asked is: why has the country forgotten about HIV?

Successes and advancements in the medical treatment of HIV and AIDS have led to complacency about the condition. That has led to a concern among many people working with HIV-infected people—particularly the smaller HIV groups—that HIV has fallen off the political agenda. That view is supported by the major funders, who are having difficulty in persuading donors that transmissible HIV is still prevalent and needs support. There is no question but that public interest in HIV and AIDS in this country has declined.

For those reasons, the Independent Advisory Group on Sexual Health and HIV, which I chair, turned its attention to public health and HIV/AIDS and invited specialists and experts to discuss this critical issue at a seminar held last year. Represented at the seminar were charities, funders, clinicians, support groups and academics. In devising the key questions to discuss, we tried to relate them to people living with HIV: which issues need to be addressed; what is being done to eliminate stigma and discrimination; to what extent are current policies and practices appropriate and effective; and what changes need to be made to ensure that services, provision and planning are in place to meet the needs and challenges of HIV? As a consequence of that seminar, we have now established a working group, with the help of the department, to look further at the issues.

Any consideration of HIV has to start with the fact that the number of new diagnoses per annum continues, as the noble Lord, Lord May, said, to rise steeply. This week, the HPA announced a figure of 6,840. There are many reasons for the increase. For example, it may be due to the fact that more people who may have been affected for some time are coming forward and it may also be due to heterosexual contact in high-prevalence areas. However, tragically, not all cases are caught in time.

A disturbing statistic was released from a major audit carried out by the British HIV Association, in which it was reported that late diagnoses account for a quarter of HIV-related deaths in adults. There is also significant evidence that a proportion of those diagnosed late with HIV infection had been in contact with healthcare professionals in the preceding year with symptoms that in retrospect were likely to be related to HIV.

The number of undiagnosed cases is still too high, to quote the Terrence Higgins Trust; HIV testing must be made easier, quicker and more accessible for everyone who has a risk of infection. Although infection rates are increasing, HIV does not warrant its own performance indicator within the NHS—even though that is so necessary as HIV is now a countrywide problem. That means that some PCTs are struggling to pay for treatment costs, so checking the levels of performance is essential.

Testing strategies are very relevant to the level of diagnosis. Following a point made by the noble Lord, Lord May, last September, the Chief Medical Officer and the Chief Nursing Officer wrote jointly to all doctors and nurses calling on them to offer an HIV test to their patients if they might have been exposed to HIV infection and to recommend that they should accept testing. However welcome that initiative was, it needed to be followed by some learning/educational opportunity or professional development, otherwise the request would consequently get lost in the GP's general workload—and that seems to be the case.

While there is a need to develop earlier testing and prevention of late diagnosis, there is also a need to intensify HIV prevention. Many of the advantages that the UK has achieved in terms of HIV/AIDS prevention are now considered to be declining when viewed against the best international standards. There has been a decline in availability of proven harm reduction and prevention initiatives; for instance, the withdrawal of needle-sharing provision for infected drug users entering prison. As part of a prevention strategy, targeted campaigns are vital, so the increased funding of £1 million—maybe not enough—given last year to the Terrence Higgins Trust to target gay men and African communities was very welcome. These campaigns need to be accompanied by more outreach work and an increase in behavioural interventions, particularly relating to safe sex. It makes economic sense. It has been estimated that preventing onward transmission of HIV saves the public purse up to £1 million per annum.

HIV and AIDS differ from other long-term chronic conditions. It is a communicable disease, associated with a negative stigma and fear that is not usually associated with other chronic illnesses. It triggers widespread stigma and discrimination. It builds prejudice and intolerance about poverty, gender, sex, sexuality and race. It reinforces existing social stereotypes and inequalities, inequalities that make women seem inferior to men.

Stigma impedes disclosure and remains the most significant barrier to people testing for HIV and so deters people from using healthcare and social care services, thereby contributing to the social exclusion of those living with HIV. It is disturbing that there is clear evidence of discrimination relating to HIV status by some people working in the NHS and in social care. That is shown by expressing inappropriate comments, taking excessive precautions, and in some instances, refusing to treat or failing to refer or test. That is unacceptable and should be a factor in the registration rules under the Health and Social Care Bill currently going through this House.

Good social care is essential. HIV is not only a medical condition but also a social one: HIV patients have complex needs that cut across both health and local government services, whether related to child care, housing, legal or benefit advice. So the continuation of the ring-fenced AIDS support grant is welcome in enabling local authorities to provide improved support and services for people living with HIV. But those services need to recognise the different groups of people disproportionately affected. The needs, for instance, of African women will not be the same as, say, those of gay men. Growing old with HIV is a relatively new reality—people who do so have a range of previously unconsidered needs such as isolation, the long-term effect of medication and living in care homes, with the need for specialist social care teams. Women asylum seekers have complex needs, many having experienced violence, torture or rape.

The problem for asylum seekers is further exacerbated by the NHS charging regulations, which were introduced in April 2004. Previously, anyone who had been in the UK for 12 months or more could access HIV treatment free of charge. The new regulations now require refused asylum seekers to pay for secondary care. This discriminatory treatment has no sound basis, as the Government have been unable to provide any evidence of HIV-related health tourism. For all other serious communicable diseases, including TB and other sexually transmitted infections, such treatment is free of charge. It is clear that these changes to the regulations are causing serious hardship.

These measures actually prevent vulnerable people, including pregnant women, accessing the vital treatment that they need because they cannot afford the charges. I understand that a government review board, jointly led by the Department of Health and the Home Office, is currently looking at the NHS charges that are applied to refused asylum seekers. Will my noble friend explain why HIV is the only serious communicable disease that is not exempt from NHS charges? When can we expect the government review board to report?

Services also need to be based on sound evidence of what works, including an assessment of evidence on self-management and greater patient empowerment. There must be consistency in standards of care, so there needs to be adequate training, awareness raising and financial incentives. That includes investment in the training of GPs and primary care practitioners, which is currently not sufficiently in place.

To guarantee proper management, there has to be a collaborative approach involving both primary and secondary care providers. This means that PCTs and SHAs should ensure that resources for prevention, promotion and treatment are treated in parallel. Prevention should not have to compete with treatment, as is the current position; they are not alternatives. To make that more easily possible, HIV commissioning services should be a single entity.

In conclusion, what is clear is that the effective tackling of HIV and AIDS requires joint efforts, nationally and locally, across politics, education, health, religion, law enforcement, immigration and social services. There has to be a whole-society approach. This means building leadership from all the sections of society, including national and local government, affected communities, NGOs, faith-based organisations, the education sector, the media and the public and private sectors.

The Government have a responsibility to ensure that the associated resource requirements are sustained for the long-term, to co-ordinate multi-agency efforts and leadership. There has to be the same level of leadership shown by the Government to the prevention and treatment of HIV in this country as is shown, quite rightly, in the response to the global epidemic through the policies driven by the Department for International Development. To do that requires strong, informed and committed leadership. HIV has to be a public health priority.

My Lords, it is a great pleasure to follow the noble Baroness, Lady Gould, who has done so much work in this area, so much of which has been immensely valuable. I also congratulate the noble Lord, Lord May, on the way in which he introduced the debate. As the noble Baroness, Lady Gould, mentioned, it is rather nice to have a debate on HIV/AIDS introduced by someone who is not one of the usual suspects, who are here. It was an outstanding speech. We look forward to the presentation with slides, which I think he would have preferred to have given. I say to the Government Whip, whom I welcome, and who will reply to this debate, that I hope the noble Lord’s speech will be referred to the relevant health Minister so that it can be studied.

Both speakers referred to our campaign in the 1980s. The noble Lord, Lord Hayhoe, who is in the Chamber, was in the Department of Health when I, too, was there. I think that he will confirm that the policy was introduced not without its own struggles and oppositions at the time.

I want to concentrate on the national position. That is not because the international position is unimportant—on the contrary; it is a matter of shame that we in the West should have stood by while 20 million or 25 million people have died from AIDS. It remains a matter of shame that men, women and children are still dying on that scale, despite the fact that medicines exist and are available to save their lives. It is a matter of shame not just for Governments but for the churches that have argued against one of the few effective preventive measures—the use of condoms—which in this context could prevent deaths in a major way. I still find it extraordinary that, for example, the Roman Catholic Church can do so much fantastic work dealing with the casualties of AIDS, as I saw in New York, but so little work preventing those casualties. I do not think that history will deal kindly with its policy.

The reason that I shall concentrate on the national position is in a sense related to the international position and the loss of life in sub-Saharan Africa in particular. As we do not face a problem on the same scale, there seems to be a tendency to ignore what is happening inside the United Kingdom; to be, as the noble Baroness, Lady Gould said, complacent about the position here. There is absolutely no justification for such complacency. The figures published by the Health Protection Agency last Friday contain little for our comfort: 7,000 new HIV diagnoses in 2007; more than 80,000 people now living with HIV in this country; the annual number of newly diagnosed people has increased by 182 per cent since 1997; and new diagnoses among gay men are at their highest level since records began, despite all the warnings given about unprotected sex. The cost to the National Health Service is estimated at somewhere between £400 million and half a billion pounds per year. If we add in the cost of the other sexually transmitted diseases—the number of which, as the noble Lord, Lord May, mentioned, has also increased over the past 10 years—the overall cost is massive.

By the Government’s own measure of what they wished to achieve, the current position amounts to a failure. The Government’s policy in The National Strategy for Sexual Health and HIV, which was published in 2001, took four years to produce. One of the key targets was a 25 per cent decrease in newly acquired HIV infections by 2007. As we can all see, it has not happened. There has been a failure of public health policy. There has certainly been a failure to meet the financial needs. Most of all, however, there has been a failure of will, a failure of commitment. To be blunt—and this is not remotely a party political subject—Ministers have successively failed to meet the challenge of HIV in this country. Unless we recognise that, we are not going to achieve any change and nothing is going to improve.

It is always tempting to sweep the issue of HIV/AIDS under the carpet. It is not a popular subject with the public, as any of us who have been involved in the area know only too well. It is probably the least popular cause for voluntary giving in the whole country. It leads to potential embarrassment for politicians who have to go into the area. It almost certainly leads to controversy with the media and the press. It brings no particular penalty if it is ignored. It is an area that is surrounded by prejudice and discrimination. As the noble Lord, Lord May, said, it is an illness that stigmatises.

Despite all that, I should hope, like the noble Lord, Lord May, that we can as a nation give HIV/AIDS a greater priority than we have managed over the past decade. I think that we should ask why the policy has failed as it has. One reason is the current orthodoxy in the health service that everything should be devolved. In so many areas that view is exactly right; in an organisation as massive as the National Health Service, good management means that power should be devolved downwards. But it should not be an inflexible rule. The Department of Health still has a direct responsibility in some areas. One of those areas is public health, certainly when we are dealing with a subject that is as difficult and sensitive as HIV/AIDS.

The Government’s White Paper Choosing Health is an example of what can go wrong. The Government pledged £300 million to sexual health, much of which was to be allocated—devolved—to the primary care trusts. Ministers took credit for doing so and said that the money had been spent. Unfortunately the money had not been spent. As a survey by the independent advisory group made clear, only 30 of 191 primary care trusts had spent all their allocation for the purpose for which it had been allocated. Primary care trusts had the option to spend it on other things and they used that option, despite the fact that the Government had earmarked the money for HIV/AIDS.

Perhaps I may give another example, from my own experience. Most of those who remember our campaign of 1986-87 remember the public education, television adverts, icebergs, tombstones and leaflets sent to every home—and I would defend every one of those—but we also took one important additional step: we took the decision to supply free clean needles for drug users. It led to a permanent improvement in the position which has lasted to this day. The decision was taken at the centre but not everyone at the centre agreed with it. As the House may imagine, we had some fairly fierce debates on the subject, and some fought against it. Ironically, some with the most difficult problems opposed it on the grounds that they did not want to encourage drug use. Had we left the policy to local health authorities, I am fairly certain that it would not have been implemented in remotely the way it has been in the United Kingdom. Some would have done it but others would not, and HIV infection would have continued to spread in that way, as it has been in other countries that have not followed the same policy, based on the same discredited arguments raised then.

If we are serious about tackling HIV we cannot devolve everything down to the PCTs. We should understand that the centre, the Department of Health, has a crucial role and we should go back to ring-fencing some of the resources intended for tackling it.

We should also avoid taking action that appears discriminatory and counterproductive if the aim is to prevent the onward transmission of HIV. Like the noble Lord, Lord May, and the noble Baroness, Lady Gould, I am puzzled by the Government’s HIV policy in relation to the charging regulations introduced in April 2004. I do not think that there is any evidence that HIV tourism is occurring in this country. I do not see why HIV should be the only exception to the general policy. It also does not make sense in terms of cost. It means that people will become vastly ill and then have to go to Accident and Emergency for treatment. It also increases the risk of onward transmission of the HIV infection. So I add to the two previous speakers’ calls for the Minister to make clear the Government’s aim.

The Government have a direct responsibility in tackling HIV/AIDS, and I believe that there are three urgent priorities. First, testing must be improved and increased. About 25,000 of the 80,000 people living with HIV are unaware of their infection. That is obviously bad for them, because they do not get access as quickly as they might to treatment, but it is also bad for others, because onward transmission continues. Improved testing entails faster access for those wanting tests at clinics. We need more opt-out testing—there is no question about that—and we need testing outside the traditional clinic setting. I am a trustee of the Terrence Higgins Trust, which has done some pioneering work in offering testing at university campuses and in community centres. That has been valuable and successful.

Secondly, priority needs to be given to making much more progress in sex and relationship education. At present, we have a patchwork of provision between schools: some are good and some are frankly inadequate. I do not dispute that there is a complex challenge for schools here, particularly because they are already pressed by a tight timetable. I do not dispute that it means better training than we have now; but if more can be done, there are substantial advantages for young people, and there is the prospect that better education will help understanding and reduce the stigma surrounding HIV/AIDS.

The third priority is public education itself. The truth is that public understanding of HIV and its consequences has lessened over the past 10 years; we have gone backwards, not forwards. Fewer people understand how HIV is transmitted. Almost a fifth of the population are not concerned about HIV because they believe that there is an easy treatment available for it. More and more people are ignoring the advice always to use a condom with a new partner.

At the time of the 1986 campaign, we said, “There is no vaccine and there is no cure”. That remains the position today. There is no cure. We now have drugs that preserve and prolong life, but it is a lifelong condition, taking with it a risk and a range of disadvantages with the disease itself. On the progress of the vaccine, the latest news is anything but encouraging. No one believes that we are on the verge of a breakthrough. That is not a reason for abandoning all research, but it is a further reason for underlining the importance of public education.

We need to put much more effort, imagination and commitment into public education. We have heard pledges from the Government before that serious money will be spent in this area, but they have not been followed through. Instead, we have had a debate, which has now lasted for a decade, on whether there should be a general campaign on HIV and sexual disease or a targeted campaign. The blunt truth is that we have had neither of those campaigns. At times, we have gone back to the old, tired debate about whether, if we advertise, we introduce people to areas about which they know nothing.

I would say only that when we held our campaign, we received very few complaints. Young people and parents valued the advice and, what is more, they acted on it. The advice came with the authority of the Department of Health, which was a fantastic advantage. It is utterly absurd that, at a time when modern communications allow us to get messages directly through to the public better than ever before, we are all but ignoring that course. We need to tell people, young people, about the dangers of HIV/AIDS, for unless we do, the figures will continue to rise. The tragedy is that it is not inevitable that the figures rise year by year, as they have done, but if we are to prevent that happening, the Government have to take a clear lead. I regret to say that this, at present, they are failing to do.

My Lords, I thank my noble friend Lord May of Oxford for this very timely debate. The Times on Saturday last week stated that HIV infection is continuing to grow, according to figures from the Health Protection Agency, and gay men are being urged to practise safe sex and have an annual HIV test in an attempt to halt the rise in infections in the UK. That is supported by the Terrence Higgins Trust, which stated:

“But the fact remains that gay men are still at highest risk of HIV infection in the UK. For those numbers to come down, we need to step up resources for targeted HIV prevention programmes”.

I have been a member of the All-Party Parliamentary Group on AIDS since its inception in 1985 or 1986, when HIV began to present as something to be aware of globally. When the noble Lord, Lord Fowler, was a Minister, he promoted a hard-hitting publicity campaign, which made the public realise that HIV/AIDS was a new danger that could kill. I remember the advertisements to this day. To have an impact now is more difficult. With new drugs keeping HIV at bay and people keeping in better health and living longer, it does not seem so important to be careful. Some people even think that HIV is no longer a problem. That is very dangerous. There is an ever-increasing danger of multiresistance to drugs. There is a need for ongoing publicity so that people at risk realise that there are still dangers around. Campaigns need to be updated from time to time.

Human immunodeficiency virus attacks and destroys the body’s natural defence mechanisms, exposing it to certain infections. HIV can be found in blood, the rectal mucosa, semen and seminal fluids, vaginal fluids and breast milk. The amount of virus present in these tissues is enough to infect a person. While HIV can also be found in sweat and saliva, the amount is too small for an infection to happen. The destruction of a person’s immune system makes them more susceptible to other illnesses, especially infections such as tuberculosis, pneumonia and cancers, many of which are not so dangerous a threat to a healthy person. When the immune system has reached a certain low level of CD4 cells, or when some of the associated infections have happened, AIDS—acquired immunodeficiency syndrome—has developed. This is a condition that needs specialist experts to care for patients.

In 2006, there were an estimated 73,000 people aged 15 to 59 living with HIV in the UK. While London remains the main focus of care for people living with HIV, with nearly 24,000 residents accessing HIV-related care, the largest proportional increase was seen in Yorkshire and the Humber, where 2,475 people were accessing treatment in 2006—a 21 per cent increase.

The Royal College of Nursing, with a membership of nearly 400,000, launched its Think Positive campaign in 2007. I was pleased to be able to attend the launch at Cavendish Square. The campaign was introduced in response to the growing need for nurses working outside HIV and sexual health services to be familiar with the changing needs of people living with HIV and to ensure that they practise and communicate sensitively. The Royal College of Nursing is encouraging a change in attitude that will end the stigma that continues to surround HIV/AIDS. HIV/AIDS is not only a sexual health issue but a chronic long-term condition with which people are now living into their 50s and 60s. The Royal College of Nursing would like to see an updated strategy that takes into account the wider needs of people living with HIV. Perhaps this could be included in the Health and Social Care Bill.

The Government and the NHS must end the existing postcode lottery for HIV care and ensure that everyone has fair and equal access to high-quality treatment, care and support wherever they live. I hope that all people living with any long-term condition would also have that. Trusts should be encouraged to assess, monitor and forecast the needs of people with HIV living in their communities and utilise this information to ensure that sufficient funding and resources are allocated to services in their area.

As more people with HIV are living longer, there is a greater need to increase the number of specialist nurses working in HIV care to provide the high-quality care and expert support that they need. Sexual health and HIV services were particularly badly affected by financial deficits in the NHS, with many specialist nursing posts remaining unfilled. The Royal College of Nursing would like to see training extended to nurses working in primary care so that they can offer HIV testing to their local communities.

Last week I was interested to see a Telehealth Solutions system for monitoring people living with HIV/AIDS. Telehealth Solutions has developed the “pocket pod”, which is specially designed for people taking combination therapies. It is set by a GP to remind patients of what drugs to take and at what time and when to take viral load tests and to monitor vital signs such as temperature, blood pressure and weight. In the event of abnormal responses, an alert system is incorporated through SMS and e-mail services. This ensures prompt responses to adverse events. I am told that the pocket pod provides an essential and cost-effective tool in managing HIV/AIDS treatment, prolonging life and relieving the pressure on the NHS and patients. It should be investigated and assessed.

Some months ago, when the noble Baroness, Lady Royall of Blaisdon, was a Whip in the Department of Health, we visited the Mildmay Hospital in Tower Hamlets, which I have known for many years. There is still considerable stigma attached to a diagnosis of HIV/AIDS, as has been said, especially in many ethnic-minority groups. There is much fear of disclosure to friends, family or church because of this stigma, and patients often present late with an already advanced HIV disease because of this fear. Many people now have much better life expectancy and a good quality of life, but there are still significant numbers for whom services are far from widely or easily accessible.

The Mildmay is the only specialist centre in the UK that provides rehabilitation through in-patient and daycare services for patients with advanced HIV dementia, neuropsychological and other complex HIV-related problems. Its essential and unique services are under threat because of funding issues. As the only such hospital in the country, it is important that it is funded and enabled to continue to provide these services, while teaching and demonstrating to others how to apply its approach.

I end by asking a question that concerns the National Aids Trust: why has HIV/AIDS been singled out, in a most discriminatory way, from all other serious communicable diseases, including TB and all other sexually transmitted infections? Treatment is always provided free of charge irrespective of residency status, but HIV is explicitly excluded from this provision, so that refused asylum seekers and undocumented migrants are required to pay for secondary care. The result is that they are unable to pay if diagnosed with HIV. In almost all cases they are destitute and have to present, gravely ill, in A&E departments, risking having infected others in the mean time, as the noble Lord, Lord Fowler, said. If that includes pregnant women putting the babies at risk too, that is simply appalling.

Britain has been generous to the Global Fund to Fight AIDS, Tuberculosis and Malaria. Many other European countries should do likewise. I therefore hope that the Government will pursue this through the European committees.

My Lords, I must confess that when I put my name down for this debate I expected to hear what have already been referred to as the usual suspects, but it has not been like that at all. I thank the noble Lord, Lord May, for educating me to a great extent, the noble Baroness, Lady Gould, who added to that, and my noble friend Lord Fowler. It has been an amazing combination of speakers—certainly not the usual suspects or the type of debate that we could expect on a subject about which people feel that they have talked a lot. This is where the House of Lords shows its competence; you see people who know what they are talking about. But now your Lordships are going to hear from someone who does not know very much about HIV/AIDS.

I am a latecomer to this subject. I started taking an interest because I am deeply concerned about the situation of the poorest women in Africa and the Indian subcontinent. One cannot look at the situation of these women without focusing on HIV/AIDS. A DfID document says that, in 2007, 22.5 million were living with HIV in sub-Saharan Africa. Around 1.7 million were newly infected and 1.6 million had died, making AIDS the leading cause of death.

In sub-Saharan Africa, the HIV/AIDS epidemic is increasingly feminised. That is very frightening. It is not only in that region; look at South Africa, where AIDS is also increasing. The incidence of rape is unbelievable. In sub-Saharan Africa even little baby girls and old women get raped, and not just by strangers; it is people in the family, their priests, their doctors, their teachers. The lives that these females have to put up with—you cannot say “women” because they are also children—are unbelievable. That alone is terrifying.

UNAIDS has now said that 70 per cent of the world’s infected are women. Women have no way of protecting themselves. We have to take that important point into account. My noble friend Lord Fowler touched on the Catholic Church’s doctrine. The Catholic Church is breaching the most basic human rights of women all over the world. Condoms are the only way by which a woman can be protected from infection. If the church were to say, “Use condoms”, I think that we would see an instantaneous change.

I do not know whether noble Lords have learnt about PEPFAR, the President’s Emergency Plan for AIDS Relief, which devotes many billions of dollars to AIDS relief in Africa. I heard on the World Service, to my shock and horror, that it is being administered in Africa by the Catholic churches. We need to ask them whether they are allowing the use of condoms. If they are not, there is no point in the programme; nothing can be done. Cardinal Murphy-O’Connor said, “Send antiretrovirals to Africa; do not send condoms, because that would breed promiscuity”. What is promiscuity when no woman is safe from rape day to day, not just once in a lifetime? I do not know what “promiscuity” means in Africa.

I have also been shocked by the issue of the arrival of microbicides, which is supposedly around the corner. The National AIDS Trust says that microbicides will come online in two or three years, the Bill & Melinda Gates Foundation says that we are 60 per cent there and the International Partnership for Microbicides tries to fudge the issue by saying two to three years. These “two years” and “three years” have been said for at least three years already. There is no breakthrough. At present, the only way a woman can be protected is by the use of a condom; there is no other way.

DfID is investing a huge sum on trials in Africa. I have had a long talk with Professor Jonathan Weber, who is involved in those trials, and there has been nothing so far that gives any hope for a quick breakthrough. Conducting trials in Africa or India is also extremely difficult, because the women are not used to such things. They have to be monitored and looked after very rigidly, which is not an easy task.

I say again that I have come to HIV/AIDS through the needs of women, which are so unbelievably overlooked, especially in places such as Africa and south Asia. Women are not important; if one woman dies, you get another one. They have very little value. That is what we need to change. We need to start thinking about how women’s lives can be improved. They have no power to force their partners to use condoms. I can speak for India: you have to go quite a way up the social ladder before you find a woman who can ask her husband, or whomever, to use a condom. It is a serious issue.

The world is facing two major problems. I consider HIV/AIDS to be a major world problem. The other one is global warming, which is closely connected with population increase worldwide. It is no use our pretending that the two have no connection. If we are not allowed to use condoms or operate family planning, where are we going to end? I hope that some pressure will be applied to the Catholic Church to rethink the needs of everyone instead of just concentrating on a doctrine that is so out of date. The world is drowning in population. It is not as though we have a shortage of people, although, actually, Italy does: the Italian birth rate is 1.2 per couple. That is interesting because people there do what they want; they are not subject to doctrines. That is what happens in western countries because people can take their own decisions, but the poor have faith in their church and believe what they are told. That is where the Catholic Church needs to help—and to help the women particularly.

All the speakers today have touched on the stigma of HIV/AIDS. Nothing can really change unless people are able to say, “Yes, I am sick. Please see what’s wrong with me”. People get hidden in houses when health visitors come. In poor countries such as India, monogamous women who become infected by their husbands are not allowed to go to clinics because then everybody will know that the husband has infected them. There are many cases where women are hidden, or simply allowed to die, because there is no problem in getting another one.

So give a thought to women when thinking of HIV/AIDS and give a thought to the global situation. I know that we have 80,000 infected people in this country but I think that they are irresponsible. We need to be much more directive. Perhaps we need more education in schools; we have been ambivalent about these issues in schools and we need to be more proactive and more directive.

My Lords, I would like mainly to focus on the issue of HIV prevention in the UK, and how that can be assisted.

I am grateful to the noble Lord, Lord May, for giving us this opportunity and for bringing the benefit of his intense and forensic analysis to this subject. His speech was a compelling tour de force and I hope he continues to harass both the Government and us on the subject. I apply the term tour de force also to the speech of the noble Lord, Lord Fowler, who continues to fire on all cylinders on the subject; we are grateful for that. Many of the issues I was going to raise have been covered in those two speeches, so mine will be quite brief. I also praise the noble Baroness, Lady Flather, for her characteristic forthrightness on the subject. We should all read her speech and take it in. I shall, however, concentrate on the UK.

We are fortunate to have from the Health Protection Agency the figures for 2007, which were published just last week. They were available in a very accessible form, a press release with an accompanying article and graphs. That is just the format needed to help people begin to grasp the current underlying picture and trends. I am grateful also for excellent, highly comprehensible briefing generally from the National Aids Trust.

With my interest in international development, specifically in the field of reproductive health, I have always been aware of the huge—usually horrific—shadow of HIV/AIDS in many parts of the world, particularly in Africa. I very much echo the way in which the noble Lord, Lord Fowler, characterises the shame we should feel over the 20 million or 25 million who have died, with this country and the western world generally ignoring it. The situation was given even more colour by the noble Baroness, Lady Flather.

I have for many years been a slightly detached member of the All-Party Group on AIDS—but I have not been a committee member, as the noble Lord, Lord May, may have implied. I get the impression that the subject seems rather to go in and out of fashion in this building according to what other winds may be blowing and the extent to which what one might call “occasional fatigue” on the HIV/AIDS issue has set in. But however imperfectly the All-Party Group on AIDS may struggle to draw the attention of Members of both Houses to this key subject, I commend the group for its valuable efforts and for what it has achieved in keeping the subject in front of Parliament. I pay tribute especially to the recent and ongoing achievements of its chair, Neil Gerrard MP. We should be grateful also to the noble Lord, Lord Fowler, for continuing to serve as an officer of the group. He has done so over a very long period when, as an elder statesman, he could have retired to slightly higher things.

The noble Lord, Lord May, mentioned the recent valuable POSTnote—an excellent document entitled HIV in the UK produced by the Parliamentary Office of Science and Technology, which Parliament has benefited from. It summarises, in the customary four-page format, all the current aspects of the subject, in a form which is digestible and authoritative and is exactly what Members of both Houses need. I hope that it can occasionally be updated.

The recent survey and report from the National Aids Trust, assisted by the Health Protection Agency, confirmed that there had been a real reduction in spend on HIV prevention over the past 10 years. It has occurred at a time when the number of those living with HIV has steadily increased. The conclusion was arrived at mainly by surveying primary care trusts where the real amount spent on HIV prevention is often not clear. This trend of relative under-spending continues, sometimes in areas with the greatest local need, areas which would benefit from tailored prevention services and whose attempts are failing.

I advocate more focus on prevention. In my experience, there is always a temptation in the international field to follow the immediate treatment needed by those who are visibly suffering, and sometimes to follow the blandishments of the drug companies. As in international areas, we should aim to have measurable targets for HIV prevention, both nationally and locally. One report refers to “aspirational” targets. I would prefer the aim to be more realistic.

If the Government could devote more funds to prevention, it should be clearly identifiable how the funds are to be spent and they should be ring-fenced. The noble Lord, Lord May, said that not all the money allocated has been spent on the intended purpose and that there was disproportionate spending on treatment. I agree with the noble Baroness, Lady Gould, that the elements should be treated in parallel.

I understand that there has been some success in improving access to HIV testing and take-up. As the noble Lord, Lord May, emphasised, there has been a welcome, though possibly slow, move towards opting out rather than opting in to testing. Ready access to diagnostic services is a key part of infection surveillance and we should be more proactive in this field. I recognise the sensitivities that will have to be overcome in achieving that.

A recent excellent, very human television programme gave us Stephen Fry’s take on HIV. It showed a testing centre in Middlesbrough, I believe, which had stripped away many of the disincentives to visiting such a place. It showed how a 15-minute test can be conducted in a most sympathetic way. It deserves praise for not being heavy-handed and for not browbeating the audience. It showed what happens in real life, and it let us judge how we and others might respond. It illustrated the shame and stigma that can still be visited on those affected. It showed how physically unpleasant and draining it can be for some to be on even one pill a day for the rest of one’s life. It also showed how changes in the HIV virus create real uncertainty for some.

Slow progress is being made in this field in the UK, but in years to come we will be found to have not treated it with the seriousness and urgency it deserves.

My Lords, I, too, congratulate the noble Lord, Lord May, on introducing the debate with such clarity and passion. I invite him to join my PowerPoint Liberation Front. There are days when I think I will scream if I see another bullet point. More to the point, PowerPoint stops people making the sorts of speeches that the noble Lord made, speeches which communicate and convey issues in a way that computers never can.

I thank all noble Lords who have taken part in the debate. Every noble Lord who spoke has approached the subject in a slightly different way and added something very important. I want to pick up one of the first things the noble Lord, Lord May, said—that we need longitudinal work to draw attention to what happens with HIV. One of the lessons I always draw from our frequent debates on the subject is the need for persistence and repetition: persistence in looking at the issue and repetition in raising it. That is what we are doing today.

In preparing for the debate, I was taken back to the late 1980s when the virus and the illnesses first emerged. I remember talking to a group of people who worked with and were users of an HIV service at that time. It was a time when people put a brave face on what was a devastating diagnosis. One of those to whom I spoke did an excellent job of putting on a brave face, but he said something terribly important. He said: “I know it sounds strange to say it, but I actually feel quite lucky that I live here. I live in a country where there is a National Health Service. The reason I feel lucky is not only that I know I will be treated but that, as we have a National Health Service and it can look at the incidence of the illness across the whole population, there must be hope that it will find a cure quicker than in other circumstances”. He was right. The National Health Service has a unique opportunity to study the virus and transmission, and to do research at a population and sub-population level. The noble Lord, Lord Fowler, was right that the great tragedy of the past 25 years is that we have wasted that unique opportunity to learn. We have failed to learn some very simple lessons.

I am one of the Front-Benchers in this place who frequently lay into the Government and castigate them for having too many targets and centralised policies. However, I agree with the noble Earl, Lord Howe, who often speaks on health, that public health is an exception to that. Public health targets and nationally determined programmes—which need not be the same all over the country—are a wise way in which to develop public health policy and to make use of the fact that we have a National Health Service.

Other noble Lords have quoted statistics from the survey which came out last week. There are just two on which I wish to focus: the fact that approximately one-third of all cases of HIV are undiagnosed, which is a very high comparative level; and the accompanying statistic that nearly 40 per cent of gay men in the UK have never had an HIV test. There are public health and clinical concerns about such a high level of undiagnosed people, because they are most at risk of transmitting HIV to others. They are far more at risk of doing so than are those in care. Good evidence suggests that people with an undiagnosed HIV infection are responsible for between one-third and one-half of all new HIV infections. I echo a point made by the noble Lord, Lord Fowler, and the noble Baroness, Lady Gould. We should have learned by now, 25 years later, that HIV testing has to occur in a number of different settings, some of which are not identified as having anything to do with HIV, so that a range of different people can be tested in a place where they feel comfortable.

In 2006, the Health Protection Agency produced an excellent report entitled A Complex Picture. It was a very good title because the situation is complex. The document set out how the surveillance systems established in the UK have served the population well during the past two decades. However, it also highlighted the rise in all STIs and drew to the attention of policymakers the key issue of cross-infection. When somebody has another sort of sexually transmitted infection, they are more at risk of developing HIV because they have a compromised immune system. That is part of the issue in Third World countries to which the noble Baroness, Lady Flather, drew our attention. The coincidence of HIV with other STIs makes managing people’s health more difficult. That is important. We have had debates in this House about the rise in the incidence of chlamydia, for example.

I contrast that with the findings of a survey on clinics carried out at the same time by my honourable friend in another place, Sandra Gidley. That showed that fewer than 33 per cent of clinics reached the target of giving appointments within 48 hours, with more than half of all patients having to wait more than seven days for a diagnosis. Many clinics were working with restricted opening hours, some to fewer than 20 hours a week. Many opened irregularly. That is not the way to enable and encourage people to come forward for testing. Other noble Lords are right that cuts to community, outreach and voluntary-sector sexual health services happened in 2006. Those happened because word came from the Department of Health that the overall NHS target was to meet its budget for that year. Therefore, in PCTs across the land, all sorts of other budgets, including for sexual health, were raided. It was a false economy.

A number of noble Lords have spoken about the work of the noble Lord, Lord Fowler. Although the noble Lord, Lord Newton, is rarely mentioned, he was similarly important in that work back in 1986. I do not know whether noble Lords know it, but the noble Lords, Lord Fowler and Lord Newton, were responsible for one of the top 100 adverts of all time, and we all remember its importance.

Around about that time, I was engaged in some of the very first work in Europe on older people and HIV. We noted in statistics that more than 10 per cent of those who were infected were aged over 50, yet, at that time, for very understandable reasons, everything was targeted at young people. For older people who had become infected or who were their carers or relatives, nothing was being done. I remember going along with a colleague to talk to a bunch of older gay men one night in about 1992—so it was after that advert. We assumed that they would have a level of knowledge about infection and safe sex, but we were wrong. They wanted to hear some very basic messages about safe sex, the reason being that, although the gay community as a whole had been given an awful lot of information, it was inappropriate to them. They did not feel that they could go and get it; they did not feel that they could take it home; they did not feel that they could use it; and they missed out on those messages.

The noble Lord, Lord Fowler, said that we are stuck in that argument about global/population-level or targeted adverts. We need both. That is what we have learned in 20 years. We have learned more than anything else that health and information campaigns need to be repeated over and again. The one agency that can do that is government. It is the role of government to be there when everybody else has gone and to bang out those messages until they get right through to the population.

The noble Baroness, Lady Gould, raised the important issue of why HIV has been singled out as the only transmissible disease for which people have to pay for their care. The National Aids Trust, too, has raised it with us. I return to the fact that we have a National Health Service. I am one of the biggest defenders of the National Health Service; it is one of the things about this country of which I am most proud. I pay my taxes to fund the National Health Service, and do so not because I want to be treated—although I am—but because I want a National Health Service that will treat other people. I want a National Health Service that will ensure that the whole population enjoys good health. I want to see my taxes to the NHS going towards those interventions which are not popular and may be open to political criticism from time to time but which are fundamentally necessary to the health of the population.

I enjoyed greatly and agreed with almost all that the noble Baroness, Lady Flather, had to say—not quite all, but most of it. She reminded me that following the US mid-term elections, one of the first things to happen when the composition of the Congress and the Senate had changed was that the policy of the US Government towards funding only abstinence programmes was challenged. Given that the Bush era is coming to an end, given that change on the part of one of the biggest donors and players on the international scene, could the Minister tell us what the Government are doing to make sure that all the lost time which the noble Lord, Lord Fowler, talked about in international work on HIV is regained and that we move towards far more effective policies? Once again, I thank the noble Lord, Lord May, and I say to him, “Do not give up and do not let us give up”.

My Lords, I, too, thank the noble Lord, Lord May, for initiating this debate and for his brilliant speech. I am going to follow the example of the noble Viscount, Lord Craigavon, who did not repeat everything that has been said. All the statistics I was going to give have already been given so I will limit my remarks to a few things.

The director of the Health Protection Agency, commenting on the statistics in November 2007, said that the sooner HIV and other sexually transmitted illnesses are diagnosed and treated, the less likely they are to be passed on. That is certainly true, as the noble Lord, Lord May, said, but it is important that the diagnosis is given in the right and sensitive way, together with correct HIV prevention information and coupled with ongoing support and monitoring. There is, as has been mentioned by several speakers, considerable stigma attached to the diagnosis of HIV and AIDS, especially in many ethnic minority groups, which produces a great fear of disclosure to friends, family and community. Patients often present late, already with advanced HIV disease, because of this fear.

The free availability in the United Kingdom of highly active antiretroviral therapy—HAART—has made some people complacent about HIV transmission and there is now a misconception, as has been mentioned, that HIV can be easily treated. There is still no cure. Treatment is complex and it is given for life. The development of resistant and possible long-term side effects means that regular monitoring at HIV specialist clinics is essential. Many are now living with a much better life expectancy and with a good quality of life but there are still significant numbers with chronic and very complex HIV-related problems. For them, services are far from widely or easily accessible. An editorial in the journal AIDS published in 2007—vol. 21, 1965-66—regarding AIDS dementia commented that there is a common impression that HIV dementia is no longer important as we have these high-powered drugs. However, the prevalence of AIDS dementia has increased in spite of high-powered drugs and this widespread lack of awareness, even among clinicians, has to be remedied.

I need to declare an interest in that I have been associated with the first hospice for people dying of AIDS in Europe—namely the Mildmay centre in Tower Hamlets, which was established in 1985. We remain very grateful to a junior Minister of Health—one Kenneth Clarke. The matron, the chairman of the board of governors and the medical superintendent went to see him because the Mildmay had been closed, being surplus to requirement. These three ladies asked for the hospital back: “It is our hospital and you have taken it away”. Kenneth Clarke, in his usual jolly way, said: “Yes, of course you can have it, no problem at all, but you will never find any money to run it”. He has been a great supporter ever since and we have always been grateful to him. It is the only specialist centre in the UK to provide rehabilitation through in-patient and daycare services for patients with advanced AIDS dementia, together with other neuropsychological and complex HIV problems. Its approach has shown very good outcomes, with many patients being rehabilitated to the point of being able to be discharged to independent or semi-independent living in the community, which saves the NHS significant sums of money. Its essential and unique services are now under threat because of funding issues. It is the only such centre in the country and it is very important that it be properly funded and enabled to continue to provide these services.

The Mildmay has extended its work with AIDS over the past 15 years into many countries in Africa. I shall never forget one day in the Mildmay centre in Uganda when we saw nearly 100 orphaned children, all with HIV and AIDS, 80 per cent of whom had TB and many other infections, including scabies. Scabies presents just a few spots on the body, but with their immune system destroyed, they are covered with scabies and suffer terribly. That, of course, can be treated.

I would like to draw attention to the plight of children with HIV and AIDS. Currently there are 2.5 million children with HIV in the world. Last year new infections amounted to nearly 500,000 and deaths among children amounted to 330,000. Only 15 per cent of the 780,000 children who are in need of treatment with these high-powered drugs are currently being treated in low- and middle-income countries. Children living with HIV are often neglected or ignored and are the last to access care and treatment. Quite rightly, many donor agencies have in the past two years or so included the development of services and support for orphans and vulnerable children in their agenda, especially since UNICEF and Save the Children called for more attention to the needs of the 15 million or so AIDS orphans in the world. The issue must be fully acknowledged and included in any national and international aid programmes and government policies and strategies and plans.

It is also important to be aware of the needs of the large number of children who are HIV positive and in need of comprehensive holistic medical care. Of those who access treatment, many are living into adolescence and early adulthood with all the challenges that that brings in terms of increasing sexual awareness and expression.

During the celebrations last year to mark the bicentenary of the abolition of slavery, attention was rightly drawn to the existence throughout the world, including the United Kingdom, of a form of slavery more prevalent now than it was 200 years ago. Human trafficking is responsible for the spreading of HIV/AIDS and many other sexually transmitted diseases. It is reckoned that 80 per cent of women in United Kingdom brothels have been trafficked. Therefore most of the activity in these places is rape. As Her Majesty’s Government have insisted that all public places, including churches, display “No Smoking” notices, should they not find a similar way to warn customers in brothels that they may run the risk of being charged with rape? The amendment tabled by the noble Lord, Lord Anderson of Swansea, to the Criminal Justice and Immigration Bill a few weeks ago to make all purchasers of prostitution services liable for prosecution would certainly go some way to reducing the spread of all sexually transmitted diseases, including AIDS. Something drastic has to be done, as the demand for paid sex has more than doubled in the past 17 years. The solution may well be to criminalise demand, as has been done successfully in Sweden.

A recent “Panorama” programme drew attention to the appalling fact that 5,000 children are being trafficked into the United Kingdom and having unprotected sex. This is not only rape but a sure way of spreading disease, including AIDS. Lyndon Whitehouse, a former detective sergeant in Wolverhampton, said in the documentary that this activity is occurring in all major cities, but only two police forces have dedicated teams to deal with this scourge. He was involved in a pilot project that successfully dealt with the problem in Wolverhampton and secured 35 convictions, but the lessons learnt have not been implemented elsewhere. Apparently there are targets for reducing gun crime and burglary, but no targets for child prostitution reduction. Children are much more frightened of the pimps than they are of the law, and the violence that they suffer is terrible. One girl had boiling water held above her throat; another had her tongue nailed to a table. Will the Minister look into the reason why this successful Wolverhampton project has not been repeated elsewhere?

Care and prevention programmes really must go hand in hand, as the availability of good medical care and treatment encourages people to come forward for testing. Both HIV positive and negative individuals can then be taught about good prevention, with an emphasis on a balanced ABC approach—abstain, be faithful, use condoms—the successful programme in Uganda that resulted in a reduction in the incidence of AIDS from 31 per cent to 5 per cent in pregnant women. We do not know how far one can extrapolate that to the rest of the population, but the noble Baroness, Lady Royall, has confirmed that the Government support this ABC philosophy.

HIV infection is as least as devastating to the individual as a diagnosis of cancer, and although there is a cure for some cancers, there is no cure for HIV infection. So much more remains to be done.

My Lords, I am most grateful to the noble Lord, Lord May, for leading this important debate today. As several noble Lords have said, it has been a fascinating debate, which has embraced a wide range of issues in a sensitive and informative manner. The noble Lord has such an outstanding reputation in this area that it is a privilege to be in a position to respond to the debate.

Thanks in part to the contribution and leadership of the noble Lord, Lord Fowler, in the 1980s, to which noble Lords referred, and to his early action in introducing needle exchange schemes and other preventive measures, we in the UK have not experienced the rates of HIV seen in many other European countries. I hope that I can convince him that the Government’s policy has not failed and, indeed, that sexual health, including HIV, continues to be a priority for the Department of Health and the NHS. We are well aware of the challenges that HIV presents for people who are infected and affected by and vulnerable to the virus. I will set out later how we are responding to some of these challenges.

Last week, the HPA published on its website its provisional HIV data for the UK for 2007, which were based on reports received up to the end of December. The HPA estimates that there were 6,840 new HIV cases in 2007, which is lower than the figures for 2005 and 2006. We welcome this modest downward trend. Gay men continue to be the group that is most at risk of HIV transmission in the UK, as outlined by the noble Lord, Lord May, and others. The HPA estimated that there were 2,630 diagnoses in 2007, which is similar to the 2,640 diagnoses in 2006. Gay men’s increased risk of HIV is the reason why the Department of Health continues to prioritise them as a population group that requires focused and targeted HIV health promotion programmes. Like many other European countries, the UK is not immune from the global epidemic, and since 1999 an increasing number of infections have been acquired in high HIV-prevalence countries, mainly in Africa, from people who migrate to the UK, although the latest HPA estimates indicate that the numbers are declining, having been stable for a number of years.

Published in 2001, our national strategy for sexual health and HIV sets out the Government’s response to the challenges presented by increasing sexual ill health, the changing HIV epidemic and the need to modernise and improve sexual health services. Four of the five aims address HIV, and include work on stigma and social care, to which I shall return later. The strategy has been effective in driving our national response and driving change. The noble Lord, Lord Fowler, and the noble Baroness, Lady Barker, mentioned ease of access to sexual health clinics, which has been improved by reducing waiting times. The latest data for January 2008 show that 96 per cent of patients were offered an appointment within 48 hours, which is up from only 45 per cent in May 2005.

We have also increased dramatically the offer and uptake of voluntary and confidential HIV testing in sexual health or GUM clinics. Among gay men, this has increased to 85 per cent in 2006, from 61 per cent in 2001, and among heterosexuals to 72 per cent, from 41 per cent in 2001. This builds on excellent progress in diagnosing HIV in pregnancy and offering interventions that prevent-mother-to child HIV transmission. Today, the HPA estimates that at least 90 per cent of HIV- infected pregnant women are diagnosed before delivery, which is an increase from about 70 per cent in 1999.

On the last World AIDS Day on 1 December, we announced a major increase—20 per cent over three years, or £17.6 million—in the AIDS support grant paid to local authorities, recognising the often complex social care packages required especially for women, children and families. I very much welcome the review of the strategy which the Independent Advisory Group on Sexual Health and HIV is conducting. The IAG was established by the Department of Health to monitor progress on the implementation of the strategy. It is currently finalising the review and will present its report to the Department of Health shortly. I pay tribute to the work of my noble friend Lady Gould in chairing this group and to her long-standing role as an advocate for good-quality sexual and reproductive healthcare services for all, as well as to her keen interest in HIV prevention and care.

HIV prevention and care promotion are key elements of our response to HIV. We know from the data, as outlined by the noble Lord, Lord May, with significantly more eloquence than me, that gay men and African communities continue to bear the brunt of HIV in the UK, which is why they remain the focus for our national health promotion work. Over the past two years we have strengthened this work by investing an additional £2 million in the work delivered by the Terrence Higgins Trust and the African HIV Policy Network. This is in addition to the sustained investment we have provided over the past 10 years or so.

New work for gay men includes work with men who use recreational drugs, owners of social venues—in other words, sex-on-the-premises venues—gay men with diagnosed HIV, and work to increase and improve the evidence base for gay men with HIV. The Department of Health has commissioned Sigma Research to do a retrospective analysis of the data amassed in the past 10 years of the Gay Men’s Sex Survey. We are keen for this work to look at trends and changes over time and drill down to the subpopulations of gay men at increased risk of HIV. In the early summer of 2008 we will make the findings, including regional and local information, accessible to NHS commissioners, who will then have up-to-date information to support their provision of local services.

For African communities we are working on interventions to increase awareness of the benefits of HIV testing and the importance of using condoms. Last week, at its national conference, the African HIV Policy Network launched a new campaign, funded by the Department of Health, called “Do it right” which addresses gender issues and how they impact on prevention, an issue mentioned by several noble Lords. We are also working to achieve consensus on prevention priorities as well as strengthening the evidence base for HIV health promotion in African communities in England. This is a challenge. It certainly cuts across a variety of issues to do with culture, migration, the movement of populations and, indeed, the place of women. We are also supporting innovative work in supporting faith leaders and communities to engage in HIV prevention and social care. Later this year the African HIV Policy Network will publish the outcome of this in the form of a toolkit and supporting materials.

I turn briefly to some of the issues raised by the noble Lord, Lord May, and other noble Lords. On the screening of migrants for HIV, the current routine screening of migrants involves screening for TB in those from high-incidence countries. TB has been targeted as a serious airborne infection. Over time, around 10 per cent of those in close contact with a person with infectious TB can expect to become infected. Screening for other infections is being kept under review. However, HIV and hepatitis do not pose the same risk and screening for them might be discriminatory and stigmatising. As the noble Lord said, testing should be opt-out, not opt-in. That poses some very difficult issues for us. We are considering the recommendations from the Europe HIV conference, held last November, in which a number of UK experts participated. We welcomed the focus on making confidential and voluntary HIV testing more accessible. However, there are no current plans to introduce universal testing for HIV in the UK, as was done in the USA.

The noble Lord, Lord May, the noble Baroness, Lady Gould, and other noble Lords raised the issue of counselling and HIV testing. Moving from pre-test HIV counselling to pre-test discussion, unless a person asks for, or needs, counselling, aims to make HIV testing more routine and more normal, especially in more mainstream healthcare settings, including primary care and hospital settings. If a person seeks, or a clinician feels, that there is a need for, counselling, it is available following a positive test result. This approach has been supported for some time by the British HIV Association, the British Association for Sexual Health and HIV and others, including HIV voluntary sector organisations.

The noble Lord, Lord May, the noble Baroness, Lady Gould, and other noble Lords raised the issue of educating people. For the past 10 years, and in line with the epidemiology, which identifies the groups most at risk of HIV in the UK, our prevention and HIV health promotion has focused on gay men, or men who have sex with men, and people from, or with close links to, high-prevalence countries overseas, especially in Africa. This targeted approach is supported by the Health Protection Agency and organisations such as the Terrence Higgins Trust.

The noble Lord, Lord May, raised the issue of the money that is not being spent by PCTs on sexual health. The noble Lord, Lord Fowler, also raised this issue. Ultimately, funding arrangements are a matter for the NHS and the primary care trusts, which must be free to prioritise their local funding in accordance with local needs. However, we recognise the need for improvement in this area, which is why we produced the national strategy for sexual health in 2001, and why sexual health is a key element in the public health White Paper. It has been a priority for the NHS, over the past two years, to take action on reducing waiting times in GUM and chlamydia screening. The 2008-09 NHS operating framework and the national planning guidance confirm that sexual health will continue to be a priority for the NHS. Our targeted HIV work is additional to our new sexual health campaign, Condom Essential Wear, launched in November 2006, which tackles the five major acute sexually transmitted infections, as well as HIV. Evaluation is showing high levels of awareness.

I turn to the important area of HIV stigma and discrimination, touched on by the noble Baronesses, Lady Gould, and Lady Flather, the noble Lord, Lord McColl, and others. The national strategy for sexual health and HIV recognised the importance of tackling this, since it can have negative health and other outcomes for people with, or affected by, HIV. Last May the Department of Health published Tackling Stigma, setting out action on HIV stigma. This includes Department of Health funding for three new projects over the next two years. These are: funding the National AIDS Trust for a project to address stigmatising behaviour in the media, workplaces and the NHS; a project by the national AIDS manual to produce a booklet, HIV and You, for people living with HIV, setting out how they can respond to, and challenge, stigma; funding the Medical Foundation for AIDS and Sexual Health for a project to increase awareness of HIV among non-HIV professionals, so that they can offer the appropriate guidance, counselling and testing where they need to.

In the UK we provide some of the best quality HIV treatment and care in the world, underpinned by strong clinical guidelines and standards, and supported by excellent surveillance. AIDS diagnoses and deaths have fallen markedly following the introduction of anti-retroviral therapies in the mid-1990s, and have remained relatively constant in recent years. Deaths among HIV-infected persons fell from 749 in 1997 to an estimated 540 in 2007. AIDS diagnoses dropped from 1,083 in 1997 to an estimated 750 in 2007.

Despite these successes, we certainly are not complacent about the challenges that we face. I have mentioned the impact of stigma, which we never underestimate. Our other challenges include the persistently high numbers of HIV transmission among gay men in the UK; increasing rates of STIs; the evidence we see of the late diagnosis of HIV; and the proportion of those with HIV who remain unaware of their diagnoses. One of the challenges for gay men’s health promoters is how to keep fresh and relevant the long-standing health promotion messages for those gay men exposed to them since the 1980s, while addressing the needs of those who have become sexually active in an age of effective HIV treatments and more risk-taking behaviour generally. It is therefore essential that our national work, delivered by the Terrence Higgins Trust and its partners, gets the balance right.

We need to recognise, too, that for all groups, changing behaviour is not an area where government action alone is sufficient. We need to work with the NHS, the voluntary and commercial sectors, and individuals to promote a sustained and focused effort to improve sexual health. Action on sexual health is required through the joint Department of Health and DCSF PSA on teenage pregnancy. The target for improving access, and the inclusion of sexual health in new priority indicators, as well as detailed monitoring and reporting by the HPA of HIV have all helped to prioritise local action on sexual health and, importantly, focus action on improving sexual health outcomes, rather than focusing solely on inputs. The new NHS operating framework and national planning guidance identifies action on sexual health for 2008-09 focusing on chlamydia screening. I understand that the review of the strategy will also recommend some suggested performance indicators for HIV, sexual and reproductive health.

I now turn briefly to some of the points raised by noble Lords during the debate. I promise that I will write to reply to those that I do not deal with. The noble Baronesses, Lady Gould and Lady Barker, asked about late diagnosis of HIV. It is not clear why some groups, particularly Africans, delay testing or choose not to test. We can speculate about what those reasons might be, but they might include denial of HIV risk, lack of familiarity with the NHS—on confidentiality and open access services, for example—and concerns, as has been mentioned, about the stigma of being HIV positive. Our national HIV health promotion work is trying to address some of those issues.

On the issue of social care, which was mentioned by the noble Baroness, Lady Gould, and other noble Lords, over the past two years we have invested an additional £2 million, as I already said. That is an additional £2 million to our national HIV health promotion programme for gay men and African communities, the groups most at risk. We published an action plan on HIV-related stigma and funded new work, and last December announced the additional funding.

The noble Baroness, Lady Gould, and the noble Lord, Lord Fowler, mentioned the needle exchange schemes. In recognition of the importance of harm reduction services in preventing blood-borne virus transmission among infected drug users, the Department of Health published only in the past year an action plan to address that.

The noble Baronesses, Lady Barker, Lady Gould and Lady Masham, and the noble Lord, Lord Fowler, all mentioned, as did others, the issue of asylum seekers. The NHS is first and foremost designed for people living legally in the United Kingdom. We believe that the majority of people with HIV are living here legally and are entitled to receive free of charge the excellent NHS treatment for HIV. Asylum seekers are entitled to full NHS care without charge, including for HIV services. Those asylum seekers whose application and any appeal subsequently fails and who have started treatment continue to receive free NHS treatment while they remain in the UK. Following publication of the Home Office strategy Enforcing the Rules: A New Strategy to Ensure and Enforce Compliance with our Immigration Laws, the Department of Health and the Home Office are jointly reviewing the rules on access to the NHS by foreign nationals. That includes treatment for HIV.

The noble Lord, Lord Fowler, raised the issue of education in schools. Action to improve PSHE includes funding a training programme for teachers and community nurses who input into that programme, providing guidance to schools to help them better assess what pupils learn, provide support for PSHE teachers and share best practice.

I now turn to issues raised by the noble Lord, Lord Fowler, the noble Baroness, Lady Flather, and the noble Viscount, Lord Craigavon, about our international contribution. DfID provides substantial support through country programmes, multinational organisations and Global Partnerships. Under Global Partnerships, DfID is a key donor to the global fund to fight AIDS, TB and malaria, pledging £1 billion for 2008-15, which is an unprecedented contribution. DfID supports the Stop TB Partnership—nearly £9 million. We are funding programmes throughout the world to help reduce AIDS and address the issues of sexual health.

I am not able to deal with all the issues raised, but I should like to make one point to the noble Baroness, Lady Flather, because she knows that I have a lot of sympathy with the points she made. I agree with her about condoms and their usage and about the importance of sexual health education. I should also like to add a point to the noble Baroness, Lady Barker, about the upcoming elections in the United States. We provide a huge amount of help and supply condoms throughout the world. We will continue to do that, whatever Administration there is in the United States. We are committed to their use. DfID recently committed £100 million to the United Nations Population Fund to ensure the availability of reproductive health products, supplying both male and female condoms.

I very much welcome this debate and the attention that it has given to HIV. We have seen tremendous progress, particularly on treatment issues, but we are well aware of the continuing challenges around the world. I thank all noble Lords, particularly the noble Lord, Lord May, for their fascinating contributions.

My Lords, noble Lords who were here earlier will be reassured to discover that I have only three bits of paper in my hand, although if they could see the first bit of paper they would perhaps be less reassured. I want to thank all those who have spoken in the debate, which, it is fair to say, has been one of very high quality.

I began by saying that I find it rather surprising that this remarkable upsurge in the incidence of HIV in the UK has not received more attention. The noble Viscount, Lord Craigavon, pointed out that the issue is not fashionable. I hope that this debate, among other things, might help make it a bit more fashionable. We were reminded by several noble Lords that there are currently between 70,000 and 85,000 people—the numbers are uncertain, as I emphasised earlier—living with HIV in this country. We can keep them alive, but there is no cure and no vaccine, and I am shamelessly going to digress and mount a hobby horse for an instant.

The molecular biology that describes in molecular detail how individual strains of HIV virus interact with individual immune system cells in the human body is beyond imagination. That descriptive material has enabled us to design drugs that suppress viral replication and keep people alive. I would be willing to bet that probably nine out of 10 of the frontier researchers—the UK plays a disproportionately important role in research into the molecular cellular biology of this problem—never consciously reflect that we still have no agreed explanation of how HIV actually ends up causing AIDS. Personally, I do not believe that we will have one until we have a better understanding of the complex, non-linear dynamical system that is an invasive viral agent and the immune system. The immune system itself—questions of allergy—are still open because we have no agreed explanation of how it works. The immune system is not coded in the DNA. It is self-assembled in the first few years of life, reaches a level of complexity, and turns off. That is not understood in fundamental terms. It is described brilliantly, but we are still Tycho Brahe, getting toward Kepler and nowhere near Newton. It is unlikely that we will have a vaccine or a cure until we have understood those things.

An immunology text of today looks like an ecology text of the 1960s—the description is important and it is practically applicable, but it lacks an understanding of many of the complicated dynamical workings that knit communities together. Today, an ecology text has that analytic component. Immunology texts are still descriptive. Twenty years from now they will be different and that difference, I believe, is a prerequisite to having a cure or a vaccine.

What should we be doing in the mean time? We should be diagnosing, treating and counselling—three legs of a stool. Yes, we should diagnose people, and we heard from the Minister that we are doing a better job of that: it is possibly partly contributing to the rise in our knowledge of the incidence. At the same time, I again urge and stress that we will do better if we shift and bite the politically incorrect bullet of moving to opt-out testing, rather than basing voluntary testing on opt-in. I hope that the Minister will take that away and consider it.

The second leg of the stool is that once we have diagnosed we must treat. As the noble Lord, Lord Fowler, the noble Viscount, Lord Craigavon, and the noble Baroness, Lady Barker, strongly emphasised, it is not merely immoral, in my view, but just plain stupid that people who get into the country are freely diagnosed, but cannot be freely treated. Not only is that morally wrong, but in practical terms it is not a good idea—not just for the individuals, but for the community. I trust that the noble Baroness, Lady Thornton, will take that away, too, and I hope that we will hear well of its consequences.

On the subject of treatment, I particularly enjoyed the contribution from the noble Lord, Lord McColl—

My Lords, I really hesitate to interrupt the noble Lord, Lord May, because this is such an interesting lecture, but—

My Lords, it is a two and a half hour debate that started at 11.30.

My Lords, we still have to keep to our times and everyone has done that. If the noble Lord would wind up, we would appreciate it.

My Lords, I will be very good about doing that. The noble Lord, Lord McColl, greatly widened the debate. I will have to be dragged from the Chamber before I leave out the third leg of the stool, which is that treatment must be accompanied by counselling. I would have wittered on at greater length on this as I misunderstood and thought that I had 15 minutes to close, particularly given that we have not used up our two and a half hours. I will not go on, save to say only that I particularly welcomed the detailed comments of many speakers, and the specific comments that addressed the question that there are powerful forces in the world, led by the United States and the Vatican, that are deliberately opposed to doing effective things. There is even an office in the Vatican, led by Archbishop Trujillo, committed to telling lies about the inefficacy of condoms.

I wish to leave four recommendations with your Lordships. We should do a better job of treating; we should make counselling an integral part of everything that we do; we should engage charities more and give them more than the few millions of pounds that we are giving them—the charities are the most effective way of delivering much of this; and, finally, the Foreign Office should do more proactively in combating the faith-based ignorance that trumps scientific fact in trying to halt the pandemic. I beg leave to withdraw the Motion for Papers.

Motion for Papers, by leave, withdrawn.

My Lords, with the leave of the House, I will now repeat a Statement made yesterday in the other place by my right honourable friend the Foreign Secretary. The Statement is as follows:

“Mr Speaker, the whole world is watching events unfolding in Zimbabwe and with your permission I will make a Statement on the situation as we understand it. I hope and believe that the people of Zimbabwe will hear one message from this House: that we stand with them at this moment of opportunity and that we share their demand for a democratic future.

“For obvious reasons, the delicacy of the current situation means that I and, I am sure, all honourable Members will want to choose our words carefully, given the risk that what we say will be distorted. That does not mean that there are not some fundamental points that need to be expressed.

“I have within the last 30 minutes spoken to our ambassador in Harare. The situation is fluid. Zimbabwe’s political, civic and economic leaders are clearly engaged in intensive discussions. The full results of the parliamentary elections are still unclear. The latest tally is that 188 seats have been declared and 80 remain to be declared. The two main parties are running neck and neck. There is still no formal announcement about the key presidential election.

“Though the situation in Harare is tense, there is no suggestion of crowds massing and no reports of violence. But it is not business as usual: many schools are still closed and people are watching and waiting to see what will happen.

“Let me assure the House that through both political and official channels there has been a high degree of contact and consultation. The Prime Minister, Lord Malloch-Brown and I have been in touch with Presidents, Prime Ministers and Foreign Ministers in southern Africa and around the world. There is an international consensus that the will of the Zimbabwean people must be understood and respected.

“The people of Zimbabwe have made their choice. Outside the 9,400 polling stations, the tallies have been posted. The Zimbabwean Electoral Commission knows what those results are and has simply to announce them. The delay in announcing the outcome can only be seen as a deliberate and calculated tactic. It gives substance to the suspicion that the authorities are reluctant to accept the will of the people. They have a responsibility to do so, and Zimbabwe’s neighbours, who have borne a significant share of the burden of Zimbabwe’s collapse, have a responsibility to ensure that that occurs.

“No one in this House would want me to hand ZANU-PF a propaganda coup by endorsing one candidate or another, or by taking it on myself to announce the result. In truth, in spite of what President Mugabe would want the world to believe, the crisis in Zimbabwe has never been about personalities. It is not a bilateral dispute between British and Zimbabwean politicians or anyone else. It has always been about the policies that Robert Mugabe and his Government have chosen to follow and the terrible destruction that has been wreaked on the Zimbabwean people.

“The situation preceding these elections was shocking. The conditions for free and fair elections were not in place. The playing field was tilted heavily in favour of ZANU-PF. Up to 4 million people who had fled Zimbabwe’s crisis could not vote. In some areas, between 18 per cent and 20 per cent of those who tried to vote were frustrated by the inaccurate electoral roll. We will probably never know how many dead people on that roll cast ghost votes. But we do know that, in spite of those problems, millions of ordinary Zimbabweans still queued peacefully and voted. Now they are holding their breath: will their country reverse the spiral of decline or exacerbate it?

“The facts speak for themselves: life expectancy has halved to an average of 34, nearly 2,500 AIDS-related deaths occur per week, inflation is practically incalculable and day-to-day abuse of human rights and freedoms is commonplace.

“Britain has always supported the Zimbabwean people through the pain of their national trauma. We are the second largest bilateral donor and spent over £40 million last year on aid. Our support provided HIV treatment for more than 30,000 HIV patients and helped the World Food Programme to feed up to 3 million people—about one quarter of Zimbabwe’s population.

“We will continue with our support. We want to do more to encourage development within Zimbabwe. When there is real and positive policy change on the ground, Britain will play a full part in supporting recovery. We know that the Zimbabwean people face a massive rebuilding task. We will help them to do that with EU and international colleagues. But that can happen only when and if there is a return to real democracy and good governance in Zimbabwe.

“We will continue to do all that we can to encourage that to happen and to encourage other countries in the region to exert what influence they have over the situation in Zimbabwe. Those with greatest influence in Zimbabwe are those closest to Zimbabwe, but we are clear that the situation will not be one that Africans alone have to carry the burden of supporting.

“Our ambassador and the embassy staff, both local and UK-based, are working tirelessly in difficult circumstances. They are in very close contact with a wide range of Zimbabweans and stand ready to offer consular assistance to the many British nationals in Zimbabwe.

“Many honourable Members have been tireless advocates for the people of Zimbabwe. The people of Zimbabwe have suffered for too long. Every British citizen will yearn with them for that suffering to end and for it to end now. I shall of course seek to keep the House fully informed of events and the Government’s further actions to influence them”.

Further to the Statement delivered by my right honourable friend in the other place yesterday, I would like to update the House on developments overnight. The results of 207 Assembly seats have now been announced. The final three results will be decided by by-election. The tally gives the MDC—Morgan Tsvangirai’s party—99 seats, ZANU-PF 97 seats and the remaining candidates 11 seats. There are still no results for the 60 Senate seats and no announcement has been made concerning the result of the key presidential election. More than four and a half days have passed since the polling stations closed. The Zimbabwe Electoral Commission knows the remaining results. I reiterate that it should announce them immediately, without further delay. I am placing a copy of this Statement in the Vote Office and in the Library of the House of Commons.

My Lords, I thank the Minister for delivering the Statement today, delaying its repetition from yesterday, and for adding a brief update. I am sure that his colleagues on the justice team were grateful that further progress at the Report stage of the Criminal Justice and Immigration Bill was not delayed, given the enormous time pressure that the Government find themselves under.

I had hoped that events in Zimbabwe would have moved on sufficiently yesterday for much of the Minister’s Statement to be out of date, but I regret that this is not the case. The confusion that the Secretary of State spoke of yesterday has only partly been resolved. The Electoral Commission has finally announced most of the results for the 207 House of Assembly parliamentary seats, but there is still no official confirmation of the result of the presidential vote. Without this announcement, the situation grows even more dangerous. I am glad that the Secretary of State yesterday gave an assurance that the Government have been seriously considering contingency plans to ensure the safety of British citizens who could be caught up in any violence.

One thing is clear: despite ZANU-PF’s claims that the premature announcement of the results by opposition parties is “mischievous”, the delay of the official announcement is far more pernicious. So are the rumbling threats from leading ZANU-PF officials of punitive action should the “wrong” results eventually be announced.

Zimbabwe is suffering from a grossly mismanaged economy, with inflation at an unbelievable level and 4 million people dependent on food aid. The political system is corrupted: instances of politically motivated torture doubled over the last year and harassment of opposition politicians is routine. There is an ongoing health crisis, with an estimated 1.7 million HIV/AIDS sufferers and life expectancy among the lowest in Africa. That this situation might continue is appalling. That it might get even worse and degenerate into outright and widespread violence is heartbreaking.

A comprehensive international effort will be essential should these elections follow the unfortunate example recently seen in Kenya. The Secretary of State failed to answer my right honourable friend’s questions on the Government’s preparation for either an international observer mission or an over-the-horizon humanitarian force should the worst come to the worst. I hope that the Minister will tell your Lordships how ready the African Union is to step in, should that become necessary, and what the Government would do in support. What preparations have been made for emergency aid in the event of a crisis?

We would like to be optimistic, so I turn to what the Conservative Party would like to see: a return to good governance in what used to be one of the most successful countries in Africa. Of course, even in the best of all possible worlds, Zimbabwe’s rehabilitation will not be easy. The Secretary of State yesterday spoke of the misrepresentation of our support for NGOs working to improve the situation in Zimbabwe. We should not allow our colonial past, either in Zimbabwe or in other countries in the region, to be used to obstruct our humanitarian support.

What are the Government doing to establish better understanding among Zimbabwe’s neighbours of what we seek to achieve? What progress is being made towards establishing a comprehensive international effort, under the UN, the EU or the African Union, to forge better links with NGOs in Zimbabwe? Without regional support, anything that we say in this House or another place will remain empty words. I hope that the Minister will reassure your Lordships that not only have this Government been working to establish that support, but also that this country is ready to do everything possible to offer support in the case of both the worst and the best outcomes.

My Lords, I, too, thank the Minister for repeating the Statement and for updating it. Things are moving very fast and much has changed since yesterday. Because we were not given this Statement yesterday, I asked for it to be taken today, to give us a chance to hear from the Minister about this fast-developing area. I thank the usual channels for allowing that.

I did not anticipate that Mugabe might be removed, as now seems possible, by peaceful, democratic means. That makes me feel incredibly optimistic about development in Africa. However, we must make sure that the citizens of Zimbabwe, who are not resorting to violence, are supported and reinforced in their exercise of democracy. We are still in very dangerous and fluid circumstances and the present crisis is far from over.

Can the Minister update us on whether he feels that the parliamentary elections have been fair? The new system of posting results outside polling stations, which are then systematically recorded by the MDC, often on mobile telephones, has made it much more difficult to rig this election. Will the Government support pressure for full results to be published and compared? What more can the Minister tell us of the presidential election? Does he think that there might be a further contest?

What role is the military playing? Does the Minister think that, as is rumoured, it plans a campaign of violence to keep Mugabe in power? Yesterday, Zimbabwe’s Deputy Information Minister called the Opposition’s claim of victory “irresponsible” and said:

“They think they can provoke the police and the army”.

Will the Minister do all that he can to ensure that any actions by the police and the army to frustrate the will of the electorate will not be countenanced by the international community, particularly by SADC, whose declared standards would be breached by such political engagement by the police and military? Will the noble Lord assure us that he will ask South Africa, the AU and the UN to make that clear? What role is SADC playing? Is it correct that SADC leaders are now pressing Morgan Tsvangirai to be accommodating?

In the longer term, what we know about fragile states has immense importance here. We cannot let Zimbabwe slide into chaos. Could the Minister assure us that, even though we have pressing concerns in Iraq and Afghanistan, we will not let Zimbabwe slide down the agenda? How does he think we should balance the claims of those in the old regime? They did little to move this day forward until they saw the economic and political writing on the wall, as it is clear they now do. On the other hand, does he think it better for them to be inside, rather than outside wishing any new regime ill?

Last year, the FCO gave us a full and impressive briefing on the plans of the international community for a post-Mugabe era. Could the noble Lord update us on those plans? The Guardian reports that £1 billion in aid is likely to go to Zimbabwe. Can he confirm this and could he describe its outlines? What will happen in the near future to food aid and, in the longer term, to agricultural development and efforts to tackle HIV/AIDS, on which we have just had a debate?

Aid must not be siphoned off by international corporations, as has happened in Afghanistan. Local enterprises must be given the investment that they need to build a stable foundation for a revived economy. The assistance given to resettle returning exiles, as happened in the Balkans—albeit with the possible resentment of those who stayed behind—will be important. There will need to be programmes to reskill people. A quarter of Zimbabwe’s people have fled abroad, many with the skills that are needed to restore the institutions and the economy. Investment in education and training will be vital, especially for the young people, many of them orphans, who have been subjected to brainwashing in the youth militia. Free and open political debate must be fostered. A reformed media environment will result in a redrawing of the political landscape.

In conclusion, does the Minister share my optimism that, if Zimbabwe successfully comes through this crisis, its future will be much brighter? However, it will need sustained effort by the international community if the long years of devastation are to be reversed. I have heard it said that it would take seven years to turn around each year of the chaos caused by Mugabe. Does the noble Lord agree that this means that the international community needs to be there for the long haul and not simply for a year or two?

My Lords, the noble Baronesses have made very important points. They both understand that we speak in this House today under some constraint. There is often a complaint that in the Lords we do not have an audience. Today, we do. I shall quote from this morning’s Zimbabwean newspaper, the Herald:

“Almost the entire British state machinery—from the BBC to its House of Commons—was almost going hysterical over the delay in announcing the election results by the Zimbabwe Electoral Commission”.

Apparently, the debate yesterday in the other place was broadcast live in Zimbabwe and repeated throughout the evening. Therefore, as we discuss the issue today, we do so under the burden that those who would seek to prolong the current stalemate in Zimbabwean politics and those who would resist change will fall on anything that we say to try to convert what should be a judgment on the will of the Zimbabwean people into a diversion about whether the British are “up to it again”. Therefore, as the two noble Baronesses have done, we need to pick our words carefully and avoid anything that can feed these last-minute tactics of a failed regime in Zimbabwe.

I turn to the points that have been made. As has been reported in the press, ZANU-PF has indeed, with the completion of the returns for the lower House, lost its majority. That is the good news, but the bad news is that the results have not given the MDC a clear majority. It will be dependent on independent votes to govern with a majority, so we face a prospect of a rather unstable situation in the lower House. Whether the vote count was done fairly remains to be seen. Certainly, we have heard that the MDC and the Civil Society Network, which also made a poll analysis, both suspect that at the very least some of the majorities notched up in the seats that ZANU-PF won have been inflated and exaggerated.

However, the broader point is that this election was inherently unfair from the beginning. Far from there being a level playing field, it was, as a diplomat said to me today, more of a slalom course. Millions of people could not vote because they were outside the country; opposition leaders were allowed access to the media in a significant way only in the last days of the campaign; up to 20 per cent of electors in some constituencies were barred from voting on the pretence that their names were not on the register; and perhaps the same number of dead people voted. All that makes it an extraordinary achievement for the Opposition—and the people of Zimbabwe—that they have prevailed and won the lower House election against all the odds. One knows that if one was to assume what the real vote of the people of Zimbabwe was, it would reflect a runaway victory for the Opposition.

That brings me to the questions about what happens next. Clearly, at this point there are two possible outcomes. One is that there is a second round—that President Mugabe insists that Morgan Tsvangirai has not crossed the 50 per cent mark in the first round and demands the right to challenge him in a second round. If that were to happen, there would be a clear need to ensure the deployment of a much strengthened international observer. In the first round, the Zimbabweans did not allow observers from Europe, let alone from the United Kingdom. They allowed to be present only those whom they saw as observers from friendly neighbouring countries. I think that those same friendly neighbours would be the first to agree with us that, in the case of a second round, they would need the assistance of other international observers, from Europe and elsewhere. With a leader who has ruled in the way that President Mugabe has for the past 28 years, it is impossible to conceive of him winning unless there were a massive effort to steal the election result. Therefore, it would be very important to put in a strong observer presence to ensure that the SADC principles of free elections were respected.

If, on the other hand, Mr Tsvangirai has indeed triumphed on the first round and has crossed the 50 per cent mark or if President Mugabe chooses not to contest the second round, then the need immediately to try to support a new Government with humanitarian assistance and longer-term reconstruction assistance is critical and urgent. I think that the United Kingdom is well placed to assist in that. We are already the second-largest humanitarian donor, and we helped the WFP to feed 3 million people last year—almost a quarter of the population of Zimbabwe. One can expect to see that programme expanded in the immediate short term after the devastating impact on the economy of these elections. We have just contributed to emergency drug purchases for the country and we have plans to step up and expand that emergency humanitarian operation.

Secondly, if, as I say, there is a transfer of power to a democratically elected Government who move quickly to stabilise and restructure the economy, we have every intention of being major development partners—both as a principal bilateral donor and through our role as the largest donor to the World Bank and the African Development Bank.

This morning’s report to which the noble Baroness referred muddled dollars with pounds. The estimate is that the absorptive capacity of Zimbabwe in these early stages will probably rise to $1 billion next year and perhaps $1.3 billion in the year after that before levelling out and subsequently falling. It is expected that Britain will play a major part in providing the finance for that both bilaterally and through our multilateral efforts. I say “a” major, not “the” major, because this will be an internationally shared activity in which we would expect many others to play their role. I can certainly assure the noble Baroness that there is no intention of this being a short-term effort or of it taking second place to other priorities.

I think that everyone in this House and the other place is combined in our desire to see Zimbabwe—that formerly prosperous country—put back on its feet and able to enjoy the economic opportunity that it justly deserves after all that has happened. The omens look better than they have in quite a long time: finally, the long nightmare of the people of Zimbabwe is coming to an end.

My Lords, I hear what the Minister said about there being an audience in Zimbabwe and, indeed, matters are moving very fast. However, does he agree with the view expressed by Archbishop Desmond Tutu that now is not the time for quiet diplomacy and that every possible and very strong representation should be made to President Thabo Mbeki at this time?

My Lords, all the leaders in southern Africa have been attempting to speak directly to President Mugabe to try and make him aware of the situation. In general, they have had a lot of difficulty reaching him, but Thabo Mbeki plays a particularly important role. Disappointment and frustration have been expressed in this House and the other place about the negotiations and mediation he facilitated between ZANU-PF and the MDC. However, let us remember that that negotiation created the moment of opportunity we have now. He always argued that it was a case of getting to elections and then there will finally be a change in Zimbabwe’s politics. The Prime Minister has spoken to Mr Mbeki and will speak to him again, to re-emphasise the need for consistency in finishing what he began. He can take credit for having begun the change in Zimbabwe. We will press him to be a prominent leader, both in public and private, and ensuring that he finishes that work.

My Lords, as someone who, for many years, throughout the efforts of liberation, supported both ZANU and ZAPU, I say to this House—and in the hope that it is broadcast in Zimbabwe—that I rejoice in the coming end of the Mugabe regime. I welcome the very strong commitment given by Her Majesty’s Government to providing sustained, effective, usable support to democratic Zimbabwe, whenever that event really comes to pass, which I hope will be in the next few weeks.

Will Her Majesty’s Government strongly emphasise to President Mbeki that it is entirely consistent with the role given to him by the South African Development Community to maximise and intensify pressure on Mugabe to quit now, in order to minimise tension and crisis and provide the possibility of a commencement to recovery to a country whose economy he has utterly devastated but whose spirit, manifestly, he has never managed to kill?

My Lords, I agree with all that my noble friend has said and congratulate him and Mrs Kinnock on their roles, over many years, in supporting the forces of freedom and human rights in Zimbabwe. Let me at once say that we will certainly encourage President Mbeki—as the SADC leader on this issue—to be as strong as he can be in his representations for the need for President Mugabe to go now. I certainly defer to President Mbeki to choose how he delivers that message.

The critical point now is for Zimbabwe’s neighbours to find a way to allow President Mugabe to step down and out of a contest whose continuation and prolongation can only bring him humiliation but possibly only after further violence against the people of Zimbabwe.

My Lords, does the Minister agree that we have left the decisions too long to SADC? Zimbabwe left the Commonwealth because Mugabe took it out, not because the people wanted to leave. We have said before, in this House, that the precedent of South Africa—when we recognised that we would still talk about South Africa at the Commonwealth meetings, although the South African Government had withdrawn—should be applied now. Therefore, I hope that the Secretary of State, who said that he would be approaching the new head of the Commonwealth at the appropriate time, will regard this as the appropriate time.

It is a time when the Commonwealth can do a great deal. Those African states are members of the Commonwealth. I do not think that it is right, and I do not think that anyone does, that one part of the Commonwealth should make decisions for all of it. If the Commonwealth, as a whole, observed the next round of elections, or the next situation, that would be a considerable reassurance to the people of Zimbabwe, who have recognised that local considerations—and African ones—have worked against them in many ways. There can be nothing to stop us bringing in the whole Commonwealth—after all, there are Zimbabweans in Australia, New Zealand and Canada. The Commonwealth is ready in all sorts of ways to help in terms of trade union activity and education. A lot is there and it would encourage the people of Zimbabwe to feel that they are part of that family again and have been recognised as such.

My other point is that, as I am optimistic enough to think that things are going to change, it is extremely important that we have the right people involved in the UN. Unless the present head of the UNDP is withdrawn, there will not be very much confidence in the UN’s role in the future of Zimbabwe. Two successive UNDP leaders have been far too close to Mugabe and indeed, in one case, have taken land from him.

It will be extremely important to create confidence among the people of Zimbabwe by telling them that the international community is going to come to help them, but it will be the right people. I propose having Anna Tibaijuka as the UN commissioner. She would have their total trust—she reported honestly on the Murambatsvina. Her role in the UN is to do building and that is what is going to be necessary. She understands the situation, she is respected and she understands women’s issues. She would make an excellent UN representative.

I hope that we will look ahead and not just sit down and wait. We will move into the Commonwealth and we will bring the UN up to scratch.

My Lords, I take the point of the noble Baroness about Zimbabwe returning by its own choice to the Commonwealth and to be welcomed back. However, I doubt whether that is likely to occur within the 21 days before a second round in a presidential election and therefore whether it is practical to have Commonwealth observers in Zimbabwe for a second round cannot be resolved today. In the longer term, I very much hope that the Commonwealth can be part of the international healing of Zimbabwe’s relations with the rest of the international community.

Regarding the United Nations, the World Food Programme is feeding 3 million people, and UNICEF has a major programme dealing with the horrendous problem of HIV/AIDS orphans in the country. Because of the restrictions on international NGOs operating in the country, those two parts of the UN and, I suspect, others, will be critical parts of the first humanitarian response.

My Lords, when democracies announce election results, particularly in multiple elections, they are usually announced with a certain hierarchy of power. If it happens in this country, the general election is announced before the council results and the parish council results would be the last to be announced . We have had the results for the lower House of Parliament; I saw on a website an hour ago that we are now going to have those for the Senate. Does the noble Lord expect the local government results will then follow, before we even get the presidential results? This seems a very strange way of announcing these results.

Secondly, we have heard about 100,000 per cent inflation. Shifting this and changing that economy seems to be totally uncharted ground. If we are talking about the demise of Mugabe and a fresh start, with Morgan Tsvangirai coming in with new people who have never had political power, what assistance can be given? Is it possible to scour the world for people who can give assistance with that 100,000 per cent inflation rate?

My Lords, let me immediately say that the noble Lord is correct; we probably will get even the local election results before we get the presidential count. But that is only one of many extraordinary factors about this whole election. One can only hope that good sense and some integrity from the system will prevail, not least that provided by the extraordinary electoral breakthrough of having had the individual tallies placed on polling station doors and having had civil society photograph them and write down the numbers; all of that is impeding the scale of actual, possible electoral theft. However, delay is becoming a substitute for owning up to the truth of what the real results are. We continue to press for announcements now—we imagine that the numbers have been known since the beginning of the week—to the Electoral Commission and its supporters in government.

On ending hyperinflation, a new Government are obviously likely to need expertise from around the world. There are an extraordinary number of distinguished Zimbabwean economists living in exile in countries such as Britain, Canada and the United States whom one hopes would be a lead part of such an effort. They can certainly be supplemented by expertise from organisations such as the Commonwealth. This is a time when help will be needed, not least because ending 100,000 per cert hyperinflation is a very difficult business. It involves a freeze on prices, which is immediately followed by empty shelves; Zimbabweans will feel that they have had quite enough of that. To manage this by using humanitarian interventions to prevent too much hardship for people as the economy is stabilised and the money supply brought down will be a challenge not just of economic management but of political will and of the stability of the new Government.

My Lords, I commend the people of Zimbabwe for their calm and distinguished response to recent events. They have been dignified and they deserve the support of the entire international community.

The people have shown themselves to be democrats and worthy of the real fruits of democracy. I am sure that this House will welcome the Statement, although it can only be work in progress. I recognise, as the Statement suggests, that the Government are working extremely hard at all levels with the international community to seek to build a progressive coalition for real and lasting change in Zimbabwe. As I listened to the Statement, I transported myself to a citizen living in Zimbabwe, who would like to put one or two very simple questions to the Minister. They would say, “We have tried soft diplomacy but it has not delivered for us. Have you got a plan B?”. I feel sure that that is what they would demand. If the answer is yes, what is it? Archbishop Tutu said publicly that he believed that soft diplomacy is no longer an option; we will not mobilise the international community to the point of action—real, tangible engagement—unless we are seen to be committed and giving leadership.

The people would say, “We have suffered enough. We cannot suffer much more from sanctions or sporting or cultural boycotts”. Above all, the people of Zimbabwe are looking to the international community to build the capacity for leadership. I sense, and I am confident that this House senses, that we have now passed the tipping point, and we must not let this opportunity pass without ensuring that we have the leadership capacity to take the responsibility of government and rebuild that great country.

My Lords, if my noble friend will forgive me, let me say a word in praise of soft power. President Mbeki has been criticised in this House—we have all expressed frustration about the slow progress of the mediation—but it is that mediation that has got us to where we are today: a moment at which, after 28 years of absolute power, President Mugabe is on the edge; his days are over; the regime is finished. We are now debating the manner of its ending, not its continuation.

I add, in praise of soft power, that, for the first time since 1980, President Mugabe faced the people of Zimbabwe without his usual alibi; for the first time, he was not able to campaign against a British Prime Minister. In every other campaign, his opponent has not been someone in Zimbabwe. When Morgan Tsvangirai ran against Mugabe before, you would have thought, if you had looked at the campaign speeches and posters, that his opponent was not Morgan Tsvangirai but the Prime Minister of Great Britain. We have managed, on this occasion, to remain out of the firing line of President Mugabe’s campaign rallies, leaving him with no excuse but to be confronted by a people whose lives have been reduced to utter penury by his mismanagement and misgovernment. That has brought us to this point. There is a good answer to people on the first of my noble friend’s questions.

On my noble friend’s second question, there is, at this point, also a need for firmness. Soft power should not be malleable power. At this point, privately and publicly, President Mugabe needs to understand that his choices have narrowed to two impossible options if he chooses to go forward: a second round in an election that he would surely lose, now that his political mortality and autocratic rule have been pierced by an inevitable second-place finish in the first round; or the option of trying to steal the election. The position of the SADC leaders, the position of the international community more generally and the position of the people of Zimbabwe, in view of the overwhelming sentiment that they currently feel, rule that out. He faces departure from office. We must ensure that we say and do nothing that gives him any wriggle room. He must now confront the consequences of the electoral situation of this week.

My Lords, the Minister rightly mentioned Zimbabweans in this country. We should pay tribute to the thousands who sought asylum here; they have made a real contribution. Unfortunately, a group of asylum seekers is due to be removed from this country. Will he confirm that the Government are considering this quite seriously at the moment, pending a court case? Will he urge his colleagues in the Home Office and the Foreign Office, who have made mistakes before—at considerable human cost—not to remove Zimbabweans forcibly at this time?

As the noble Earl knows, the UK has believed that many Zimbabweans completely deserve and need asylum but that a small group perhaps did not meet those conditions. The enforced removal of failed Zimbabwean asylum seekers was suspended, pending the outcome of the so-called AIT litigation. That position will be maintained until any and all applications for permission to appeal the determination are dealt with. In light of those current circumstances, we are of course looking at this whole issue with great care.

My Lords, I echo the comments of my noble friend Lord Morris and other noble Lords in offering congratulations to the people of Zimbabwe on their bravery and dignity in voting for change decisively—I use that word because I believe that they have voted decisively, given all the obstacles placed in their way, not least the fact that some 4 million Zimbabweans abroad have been denied the right to return to vote. However, I have some difficulty in echoing the views of my noble friend Lord Morris about the tipping point. I fear the scenario alluded to by the noble Baroness, Lady Northover—that if, as seems inevitable, the presidential election goes to a run-off, ZANU-PF will invoke the military, as it did in the 2002 elections, intimidating the MDC, preventing it from campaigning and seeking to return Robert Mugabe to power.

I welcome the Minister’s confirmation that a $1 billion package is being discussed. I hope that it will be further discussed at the IMF spring meeting in Washington later this month. My question inevitably must be this. If somehow Mugabe manages to hang on, I do not believe any longer that we can leave the people of Zimbabwe on their own in light of the bravery that they have shown, so what plans will the Government make as a contingency—a so-called plan B—if the people are not given the outcome of the election that they have claimed?

My Lords, we are determined to make sure that, if the election goes to a second round, President Mugabe will not with military or any other help be able to steal it. Were he to do so, he would confront an international community more united and determined to end this farce than ever before. Let me say for I suspect the first time in this House in 28 years that this has been a terrible week for President Mugabe and a wonderful one for the people of Zimbabwe.

rose to call attention to the environmental importance of areas of outstanding natural beauty; and to move for Papers.

The noble Lord said: My Lords, this seems a sudden step away from the drama and tragedy that is Zimbabwe to the relative tranquillity of the British countryside, but I am pleased to have this opportunity. The National Association for Areas of Outstanding Natural Beauty asked me not long ago whether I could make a little noise about AONBs at Westminster. I am glad to have the opportunity to do so this afternoon.

I must first declare an interest. I was for seven years chairman of the Sussex Downs Conservation Board and I have for the past three years been chairman of the South Downs Joint Committee, for which I am paid a modest salary. The South Downs Joint Committee is a coming together of the Sussex Downs and the East Hampshire AONBs and it therefore covers the Downs for nearly 100 miles from Winchester to East Sussex.

I should also declare a second interest in that I have the good fortune to live in the Sussex Downs AONB. Every morning when I am there I can stare at our,

“blunt, bow-headed, whale-backed Downs”,

to quote Kipling, and at the Mount Harry hill behind which Henry III was famously defeated by Simon de Montfort in the Battle of Lewes in 1264. We have natural beauty and a good deal of history, too, around us. I thank Elizabeth Shepherd for the extremely good note that she wrote for the House of Lords Library on the origin and history of AONBs. Because of that note, I do not intend to spend any time on past history. I also thank the NFU for its press release, which I received yesterday. I am delighted to read the following sentences in it:

“We believe that in general the AONBs do achieve the primary purpose of conserving and enhancing the natural beauty of the landscape. Local experience suggests that AONBs have dealt sensitively and pragmatically with landowners”.

Good words coming from the NFU.

It is interesting that today the word “environment” is on everyone’s lips. Yesterday I listened to the Secretary of State, Hilary Benn, on the radio. He was talking about the number of new homes that were going to be built and the importance of their not causing “environmental damage”—his words—through carbon emissions.

What does the phrase “environmental importance” mean in relation to AONBs? I believe that it has two meanings. The first is about natural beauty. Can the existence of an AONB in the first place persuade a farmer that through a countryside stewardship higher level scheme, for example, he will leave 50 yards of grass on the edge of a ploughed field where rare invertebrates, unusual birds, flowers and butterflies may come? We have in a measure succeeded in that in the Downs around me. We have refound the Adonis Blue butterfly, the Brimstone butterfly and even a man orchid. The environment influence in that case is about beautiful hills, grass fields mown by sheep, clear streams with fish in them, ancient woods and more trees being planted to absorb the carbon.

There is a second environmental purpose, which in my book is something bigger and more important: an attempt to share the country with those who live in and only know the towns, so that they can appreciate and enjoy a good day in the country and are tempted to do it again. For some time we have had the Take the Bus for a Walk campaign to encourage people living in Brighton, which has a lot of land in the AONB, to take the bus to be dropped in one part of the Downs, walk for three or four miles and then take the bus back into Brighton again. We have encouraged people to visit bed and breakfasts and to leave their car behind, so that they can walk or bicycle for all the following day. I want to have more visits by schoolchildren to look at the beauties at Cuckmere Haven, but I also want them to go to farms to see chickens lay eggs, to see how milk comes out of a cow and not to be frightened by a herd of bullocks. All those things are possible for AONBs to do. They would all come within the definition of AONBs’ charges and tasks in the CROW Act of 2000. As the population grows and tourism increases, and as towns grow bigger, it seems inevitable that there will be more demand for quiet places where traffic noise does not drown out all the birdsong.

Where will the money come from? The answer at the moment is that core funding for staff and officers comes from Natural England and the local authorities. Sustainable development funding, which is particularly for small partnership projects, also comes from Natural England. Project funding for special projects that may last up to three years or more comes mostly from Natural England but tends to bring in other funding, such as Heritage Lottery Fund money and different types of EU money. Natural England is a relatively new organisation and, however hard it tries to help the AONBs—we appreciate its efforts—all these resources are now under threat, because the Defra budget has reduced by some £200 million from last year.

I have received many e-mails over the past few days from AONBs that knew that this debate was taking place. If your Lordships will allow me, I would like to read an extract from one of them. It is from Robin Toogood of the South Devon AONB and it well illustrates the problem that we face. He says:

“To illustrate the leverage and value for money that Defra and Natural England derive from their financial input, I would cite our very successful programme called Life Into Landscape, which ran in South Devon AONB from 2004 to 2007, where Natural England was one of ten supporting partner organisations. In return for a small Natural England project contribution … (which also included Heritage Lottery Fund and European Regional Development Fund) we were able to … restore over 50 historic green lanes, assist 200 landowners with conservation work, conserve 32 old orchards, improve 20 walking trails, and involve 50 community groups in 7500 days of volunteer work. Many such partnership projects are underpinned by a small core of Natural England Funding”.

As one would expect, he goes on to say that he is now waiting for new money for more projects in future.

I have received similar comments from Dorset AONB, Kent Downs AONB, North Pennines AONB, Cotswolds AONB, East Devon AONB, Tamar Valley AONB, Isle of Wight AONB, Surrey County Council and Hampshire County Council. I recognise the widespread feeling that we could be doing so much more, but where will the money come from? AONBs do not yet officially know what money they will get from Natural England for the year that has just started.

According to the figures that I have, central government funding of AONBs for 2006-07 was £14 million and for 2007-08 was £12.2 million. It is expected that for 2008-09 it will be £10 million. Project funding for the year ahead is expected to be £500,000 for all the AONBs put together to help with staff redundancies, to try to avoid the loss of match funding from HLF and the EU and to support existing projects. There will be no new money for projects. I have to compare that with the treatment of national parks. National park money is going up from £44 million last year to £46 million this year and to £49 million in two years’ time. There has been wide praise from the Minister, Jonathan Shaw, for the good work that the national parks do, which is basically all the things that AONBs do as well.

I remind noble Lords of the depth of important interest within the AONBs. We have 25 per cent of all the sites of special scientific interest, 90 per cent of the defined heritage coast, 55,000 listed buildings and 6,500 scheduled ancient monuments. In fact, we have 15 per cent of England, representing our finest landscape.

The Government recognise areas of outstanding natural beauty because in planning terms they have the same level of protection as national parks. The Minister will, though, be pleased, and perhaps surprised, to hear that I am not asking for the same status or payments as national parks have. I know quite well that I shall not get them. However, I am suggesting that Ministers, who are very supportive of AONBs in rhetoric, should try to do something a little more in action. I suggest that as the common agricultural policy money, the single farm payments, are phased out over the next five or six years, with a review in 2009 and a new budget in 2013, Ministers should make every effort to see that some of that money is reallocated to the environmental tasks that are undertaken by the areas of outstanding natural beauty. That would be an enormous step forward and, in the difficult negotiations that will go on about the common agricultural policy, it could well be a step to follow.

The Government already look to areas of outstanding natural beauty to achieve a range of their policies: access to the coast; opportunities for disadvantaged groups to enjoy the countryside, which is covered by the diversity action plan; biodiversity targets for SSSIs; and the new strategy introduced by the Department of Health, Healthy Weight, Healthy Lives, the aim of which is to get rid of obesity by encouraging more exercise. Where can you more easily get more exercise than by cycling or walking in one of the AONBs? Therefore, I hope that Ministers will carefully consider making AONBs a new target for EU money as the common agricultural policy is changed. It would be a great opportunity for Ministers to show that they have not lost interest in the rural economy and it would help AONBs to fulfil their huge potential to improve the countryside environment in Britain. I beg to move for Papers.

My Lords, I thank the noble Lord, Lord Renton of Mount Harry, for calling to the attention of your Lordships’ House a subject that is of ever-increasing importance in the scheme of things, indeed of importance in making sure that a decent scheme of things continues. There is now a realisation across the planet that it is not only our home but our responsibility. The planet used to control us; now, increasingly, we control the planet, and we have to face up to that. Those of us who are concerned for the future of our country and for the generations to come have a historically unprecedented duty to keep the earth habitable and somewhere worth living. This is to be done in several ways, one of which is the preservation of areas of outstanding natural beauty.

The grand overview given by the noble Lord, Lord Renton, releases me to talk exclusively about the Lake District. It was one of the first great leisure and environmental landscapes uncovered anywhere in the world and as such is more than 200 years old. In its origins and its continued existence, it is an example and the pathfinder for much of the world. It is a useful and mature example of what we need to preserve and keep. Although comparatively small on the surface of the globe, the Lake District, with its unique and magnificent landscape that was scanned by our third greatest poet, Wordsworth, celebrated by our greatest literary critic, Coleridge, and our greatest art critic John Ruskin, backgrounded by our greatest children’s author Beatrix Potter, painted magnificently by our greatest painter, Turner, and many other distinguished painters up to and including Julian Cooper today, is essentially what environmental importance and outstanding natural beauty are about.

Into this small area pour 16 million day visitors each year, who support 44,000 jobs and, in effect, sustain the area. The core workforce in the Lake District sustains the visitors who sustain the Lake District. That symbiosis is crucial. The environment includes those whose livelihood makes it the destination of several increasingly urgent contemporary demands. I shall give a few more, rather more colourful, statistics. There are 33 lakes—only one is called a lake, which is a Trivial Pursuit puzzle for your Lordships—hundreds of rivers, scores of waterfalls, several of which are celebrated in immortal verse, more than 400 fells—Norse for “mountains”—a unique gondola on Coniston and bus boats on Derwent Water and other lakes. There are the highly successful Theatre by the Lake in Keswick, a music festival in the south lakes, the wonderful toy train up Eskdale, one of the world centres of poetic scholarship around Dove Cottage in Grasmere, the famous pencil museum in Keswick, the bird sanctuaries, the ospreys, the celebrated Lowther driving trials, the agricultural shows, the unique hound trailing tradition and the anorak centre of the world. There is so much, but as the pressure grows, more sustenance is needed, which is why, for instance, the Lowther Castle and Gardens project is so important to the north of the county. I look forward to the day when we can walk around every lake as now it is promised we can walk around the coastline of this country.

As in all national and natural environments of outstanding beauty, we increasingly need to keep up with the diverse demands of the visitors. For more than two centuries this extraordinary and complex environment has been fought for by philanthropic and far-sighted men and women. It is dependent on and maintained by the people who live there: their work, their sports and their habits, by those who live in it most of the year and keep it real and grounded, not a park, but a place. I sometimes wonder, idly, I suppose, why, given the billions that we allow in negative tax to the City of London and the billions we spend on sustaining projects and on mountains—fells—of legislation that appear to leak away without issue, we seem to lack the knack of looking properly after our core cultures.

I am not speaking here of the arts and the sciences, although their proper sustenance might merit another debate in your Lordships' House; I am talking about what should be our inviolable staples. For example, why are our fishermen not being helped in their overwhelmingly overregulated world? Are we not an island? More pertinently for this debate, why are hill farmers not better appreciated in the Lake District? It is they who anchor it in work that keeps its landscape, its character and its characteristics.

Dr Johnson said, “Keep your friendships in good repair”. Like all your Lordships, I think that we have to keep our environment in good repair, especially those areas miraculously preserved, such as the Lake District, which is the second biggest visitor attraction in this country next to London. That means looking after those whose daily occupation makes it acceptable for those 16 million visitors. That is my key point. The environment is basically in the hands of those who work there, and they and their jobs are as important as the landscape. I believe that that applies everywhere. Without a real infrastructure, an area of outstanding natural beauty can become a Disneyland and lose vital integrity. The infrastructure needs careful attention.

There is no lack of interest from those who are committed to the Lake District and those who use it. For instance, volunteers turn up by the hundred to put holding stones onto well worn paths up well worn walks. It is an area of outstanding national good manners, but good practice and good manners should be underpinned by good laws and good husbandry. It need not be emphasised in your Lordships' House that fresh air, exercise, the refreshment of landscape, the testing of physical limits by way of fell walking or, for the brave, rock climbing, and, above all, the opportunity to enjoy imagination in nature, become more and more valuable as the world becomes more and more citified and dissociated from roots dug in over millions of years. The bigger the cities grow, the more we need the country. That is where we came from and to which we need viscerally, at least from time to time, to return.

It is a fight to preserve the Lake District and other such areas. For instance, at the moment, the Lake District is threatened by too many wind farms. There are other threats where, as always, some private greed or public folly assails public welfare. Many fear that there is a real danger that this kingdom of outstanding natural beauty will be eroded. It is at present well run, but with something like this, we cannot be too careful.

The momentum of the times looks forward to independence. Scotland, Wales and even England are sometimes mentioned. If the Lake District is threatened, I suggest that it makes a bid for independence. After all, it is bigger than Monaco.

In the late 1940s and early 1950s, at election time, there was a man called Mr Brownrigg. He liked to stand for Parliament. He would go into a field in Wigton, a town in which I was brought up, at a time when fields came right into the middle of market towns, and shoot bullets in the air from his gun to call up a crowd, with some success. With three or four other boys, I went to hear his uncompromising rant in the dialect. We heckled—at a distance from the gun. Those were the days of serious politics.

His central policy statement was that we should build a wall around Cumbria. As an enthusiastic 10 year-old, I was a convert. Now, once again, I think that that might well be a way to hold fast the Lake District in an uncertain future, if constructive help is not fast coming from Whitehall and other coffers. We could build a wall around the Lake District. We are good at walls in Cumbria. We have a massive chunk of the Roman wall. The Lake District is netted all over with amazing dry stone walling—miles and miles of it—one of the most beautiful features of the landscape. We could wall everyone out with ease. We could charge our 16 million visitors a pound or two a head and provide a basis for our treasury. We could welcome back nuclear energy and develop it every bit as well as France, our new best friend, which gets 80 per cent of its energy from nuclear. We in Cumbria have the sites and the expertise.

Above all, we have water—the 33 lakes and innumerable rivers. We endure it. We should benefit from it. The Lake District should profit from it. As oil is to Scotland, diamonds and gold to South Africa, and gas to Russia, water could be to Cumbria—a flowing mine. As the world hots up, by way of water we could guard and preserve what is a unique environmental jewel in these islands and beyond. It might be worth the attempt. I think that we should get preparations under way just in case we need to help ourselves.

In the mean time, we should encourage those who can enrich the environment to move forward. The times and, I suspect, the people in this country are on their side and well understand and cherish the importance of such areas for themselves and their future.

My Lords, it is a pleasure to follow the noble Lord, Lord Bragg. It occurs to me that perhaps this is a subject that he might include for a good discussion in one of his morning broadcasts. I am sure that there would be tremendous interest.

Before I declare my interests, I make an apology. I have a long-standing commitment to speak in Warwickshire this evening. Perhaps I may be forgiven for leaving before the Minister winds up—I see him nodding his head and I thank him for that. I will stay as long as I can, but with the traffic as it is, I fear that I may have to leave before then.

First, I thank my noble friend Lord Renton for initiating this debate. It is a very important subject and it is a matter of concern not just to those who live in the countryside or who visit areas included in areas of outstanding natural beauty. I declare my interest as president of the Cotswolds AONB. I had the great pleasure a while ago of spending a Saturday in the area with the noble Lord, Lord Rooker, when we walked around some of the areas of unrivalled beauty. I am sure that he will remember that occasion, when we saw a sample of some of the 4,000 miles of dry stone walls in the area and a landscape equal to any in the national parks. We walked some of the Jurassic limestone grassland. We witnessed some of the work done to preserve our heritage with the aid of government and European funding. We had the pleasure of receiving the Minister at our annual general meeting last year. I thank him in your Lordships' House for his support.

The Cotswolds were designated as an area of outstanding natural beauty in 1966, and the area was extended in 1990. It is the largest AONB in England and Wales, covering 790 square miles, second only to the Lake District National Park as the largest protected landscape. It is important to remember that 80 per cent of that land is in farmland and 9 per cent is in woodland. The area covers the whole area from the border of Warwickshire to Somerset.

In 2000, the Government confirmed that our AONB shared the same landscape status as national parks. However, as my noble friend Lord Renton said so clearly, that landscape status is not reflected in equality of resourcing or investment. We must all recognise that Defra has suffered its own financial difficulties and has passed on cuts in the various agencies, including Natural England, but Defra also funds the national parks through a grant-in-aid settlement, which has risen by 4.2 per cent for this year. Meanwhile, the AONBs receive their grant aid from Natural England, and as my noble friend so rightly said, they face a series of cuts.

We are three days into the new financial year, but the board has not yet received a grant offer from Natural England. For an independent corporate body, that is of deep concern for the financial viability of the organisation. Given that the conservation board’s purposes and structures draw heavily on those of our national park authorities, I am forced to conclude that the board’s financial settlement should similarly be modelled on those of the national parks, and that it would be far better off receiving a settlement direct from Defra, rather than from Natural England.

I am sure that the Minister will state that it is for Natural England to determine its own priorities and that, if we do not receive the investment that we desire, we should enter into discussion with Natural England, not Defra. Of course, that is true, from a strict interpretation of the rules, but the cuts that have been delivered to Natural England by Defra do not leave Defra entirely free from scrutiny.

Our financial settlement from Natural England comprises three grants: the core costs, for the general running of the organisation; the project costs, to achieve projects on the ground; and the sustainable development fund for special projects, the funds to deliver sustainable development projects in the community. We face reductions in all three grants. Having taken the decision to establish the conservation board in 2004 in collaboration with the 17 local authorities in the Cotswolds, we are concerned by these cuts. We should remind ourselves that the board comprises 40 board members, 15 of them appointed by the Secretary of State at Defra, 17 by the local authorities and eight by parish councils. We are bringing together the local authorities, but after only 3 years we appear to be undermining the board’s ability to deliver before it has had a chance to begin to realise the potential benefits that led to its creation.

The SDF grant within the national parks is secured at £200,000 per park. Since its establishment as a funding stream within the AONBs, the SDF grant has reduced year on year from £100,000 in 2005-06 to what is rumoured to be £60,000 in 2008-09. This variation of grant award between the two parts of our protected landscape family and the ongoing cuts within AONBs are of great concern.

I am also concerned by the way that the SDF fund is distributed. It is awarded as a standard lump sum per national park or AONB. On average, that amounted to £300 per square kilometre of protected land last year. The standard sum spread over an extensive area such as the Cotswolds reduces to £39 per square kilometre, severely disadvantaging Cotswolds residents. Despite these frustrations, we have utilised the SDF to support more than 50 innovative projects valued at £500,000, with demand for support far exceeding supply.

Our projects fund has similarly been cut year on year over the past four years. In 2007-08 the board received £50,000, compared with settlements in the region of £120,000 four or five years ago. That is the fund that enables the board to deliver projects on the ground and enables us to secure other funding streams, such as the lottery funds. One example of how it can work is the board’s Caring for the Cotswolds project, which drew down £1.4 million from the Heritage Lottery Fund in return for an investment of £250,000 by the board—a tremendous gearing ratio. That programme helped to restore dry stone walls, invested in rural skills by providing dry stone walling training courses, restored flower-rich limestone grasslands by enabling the reintroduction of grazing and provided grants to local communities for the restoration of locally distinctive features, such as a village cross. The programme was completed in December 2007 and we are extremely grateful for that support. Without a reasonable projects grant, the board is unable to commit to similar projects and put its pound on the table in order to capture additional resources from lottery bodies.

Our core costs enable us to operate the board and employ staff. They also support the work of our voluntary wardens, who currently number more than 300. They are marvellous; they work voluntarily, investing their time in leading an extensive programme of guided walks, almost one for every day of the year, and undertaking a range of practical works to improve access and the natural environment. In June this year they will celebrate their 40th anniversary. In 2006-07 those 300 or so people invested more than 40,000 hours of time conserving, enhancing and improving the understanding and enjoyment of the Cotswolds. In monetary terms, that equates to £250,000 of effort—a prime example of volunteering in the community and the countryside.

So, no grant award three days into a financial year and a series of financial cuts year on year. Surely that is no way to invest in some of our most treasured communities and landscapes, very many of which are recognised right across the world. It is no way to invest in an asset that is worth billions to the tourism industry.

My Lords, like others here, I thank the noble Lord, Lord Renton, for initiating this debate. I shall speak about the Isle of Wight, the South Downs National Park and then three issues that relate to this debate: the place of the churches, which relates to it directly, and then transport and new housing development. I shall be brief.

A considerable portion of the Isle of Wight is made up of AONBs. It is easy, if you know the island, to demarcate where they are: you just take certain bits out where lots of people live, and the rest is a beautiful and delightful AONB. Last Wednesday I had the pleasure of taking part in a conference in the yacht haven in Cowes organised by the Island Strategic Partnership to promote the eco-island project. The speakers included John Owen, the chairman of the strategic partnership, David Pugh, the leader of the council, Bill Wakeham, the vice-chancellor of Southampton University, Sir Ghillean Prance and others.

In my view the eco-island project is the most ambitious and laudable that the island has undertaken in its history and deserves a great deal of support, for a number of reasons. It highlights the relationship between AONBs, other initiatives and areas near at hand. We cannot divide the world up into different bits; we are all related. The dream of the eco-island project is that the island will be self-sustaining by the year 2020, with, one hopes, the lowest carbon imprint in England and becoming a world-renowned eco-island. I shall give two examples. First, Vestas Blades promotes electricity and is the largest producer of blades in the UK. Secondly, there is the project, which I have mentioned on a previous occasion, to use manure from 500 cows—spelt without an “e” this time—to fuel buses. The eco-island project is about education, health and safety for the whole island and the AONBs play an important part in this.

The symbiosis between the eco-island project and AONBs is unique. There are so many AONBs and they are part of the project. If the project goes ahead, there will be a chance to test out ideas that could be used elsewhere, which makes it even more important. I am not talking just about Europe, but the rest of the world. Therefore my question is about money. I understand that AONB funding by the Government has recently been cut. I should like gently to prod the Minister on that point because the eco-island project, which is related to the AONB initiatives, would attract funding from elsewhere. Everything is related to everything else.

The noble Lord, Lord Renton, obviously knows much more about the South Downs national park than I do. However, noble Lords may care to be reminded of the fact that it starts just east of Winchester and ends just west of Eastbourne. It is a very large area, but there is a proposed reduction, about which I understand there is a certain amount of division of opinion, with a minority in favour of a reduction but the majority on the ground in favour of things staying as they are. NP status would remove some county responsibilities. Here we are touching on an area which has already been raised in the debate and which may well come up again later—the issue of complementary responsibility, which is so frustrating when you want to start something and get it going. Clearly a large national park is going to be more powerful than a number of AONBs. I believe that I speak for many people when I say that this issue needs to be resolved. Natural England rejects the alternative boundary wholeheartedly. AONB offices are constantly complaining that cuts in funding are a major problem. They say that government funding has a huge, multiplier effect.

I turn now to three other issues. Your Lordships will not be surprised if I speak on behalf of the churches. I am sure that I speak on behalf of AONBs elsewhere in the country. They are a vital part of every AONB. One example is the often visited church at Brighstone on the Isle of Wight. The South Downs includes that wonderful church at Idsworth which is so much looked at as a landmark by commuters on the train—and of course by others, as well.

If I may be forgiven for blowing the ecclesiastical trumpet, the churches in this country are in better condition than they every have been in their history, without any doubt at all. If I may sing an ecclesiastical mantra, I am not sure what the VAT situation is at the moment. I think it has been gently looked at, but certainly until recently, the churches paid more in VAT on church repairs than they received from English Heritage. That is a surprising fact which is much ignored, or not even known about. In the diocese of Portsmouth we are assessing how we use our buildings and how they can be more friendly to visitors and tourists. We are looking at this project, not just in the beauty spots but in the more brutalist areas of our cities.

I now move on to transport and the Hindhead tunnel which is a controversial saga that has been going on for a long time. One of the reasons for the length of time it has taken to get the thing going has been money rather than local and national discussion. However, the local and national discussion has slowed it up. Can the Minister say—this is not directly related to the debate, but abuts it—whether there are ways in which these processes can be speeded up? One of the consequences of the tunnel is that the local AONB office has received, I hope, a promise—although it is yet to be confirmed—of funding for project officers to assist with landscaping issues on Hindhead common and in the regeneration of Hindhead. I have known of this for 20 years because before I came to Portsmouth I lived in Guildford and I have watched the area become more depressingly carbonised with traffic fumes, making the place less attractive as we drive through it. If we are going to have a national park or a number of AONBs, people will still have to move around the country. I am sure that the quality of landscaping planned for Hindhead is one of the results of AONBs and the national park project near it.

The question of housing developments brings in the South East Plan, which I suspect is behind strong feelings about the threatened reduction in size of the South Downs national park. I recognise fully the need for affordable housing. When I look around my own patch, as I am sure will my colleagues theirs, I see where housing can be built and where it perhaps should not be built. However, it needs to be built.

I know that the Planning Bill is producing a new system of infrastructure whereby the Secretary of State does not have the final say, which may or may not be a mixed blessing. Near where I live, in the development of Whiteley, a rather soulless shopping centre is going to be destroyed—fortunately, as far as many people are concerned—and rebuilt. There is an example of where developers and planners get it wrong.

I shall not name names, but the sense that I get from conversations with people around the diocese is that, where there is to be a new housing development, the local authorities are very much—perhaps too much—in the hands of the developers, who because of their experience and their money hold the strings of power. There is an area which needs to be checked.

I repeat what I said earlier. We are looking at AONBs—the Isle of Wight and the national park of the South Downs—in relation to many other issues. This debate is timely, because, in the past few months, the world’s population of city dwellers has moved from being in a minority to being in a majority. We are not quite sure when the change was made, but it is probably about now. Perhaps that is why we turned our clocks forward an hour last Sunday.

That makes me think of the Bible, which begins in a garden of lost innocence, where responsibility is avoided—surprise, surprise: that is very much a local and national government issue. We have to play God, whether it is in planting trees or initiating stem cell research. But it ends in a city, which is landscaped, lavishly irrigated and a place of space, peace and justice. It is not quite an AONB, but perhaps an aspiration in that direction. It is a place of play.

In conclusion, I pick up the comments of the noble Lord, Lord Bragg, about the Lake District. He will know that in the north-west of England and Yorkshire, “lake” is a Norse dialect word for “play”. “Legoland” is a “playland”, which my Viking forebears brought to this land with their culture. Here we have a vision of a community that is at ease with itself, where urban and rural live and work together and where we can play. AONBs are a place of play for children of all ages.

My Lords, like others, I start by thanking my noble friend Lord Renton for giving us the opportunity to consider AONBs. He has given us opportunities in the past. I remember well his introducing the 1999 AONB Bill, which was effectively put on the statute book by Part 4 of the CROW Act. My noble friend played a large part in getting through those measures, which went a small way to alleviating some of the problems which have already been touched on and which AONBs have to address—at least when one compares them to other designations.

I, too, have an interest to declare. I live and farm in an AONB in east Hampshire, much of which, incidentally, is in the Diocese of Portsmouth. So I am delighted to follow the right reverend Prelate, who takes a great interest in the rural part of his diocese.

It is inevitable that since 1949 unfavourable comparisons have been made between AONBs and national parks, as they have in today’s debate. If you were to be driven into an unknown part of the countryside and told that the area was designated, you would be hard pressed to know whether you were in a national park or an AONB, or indeed in some other form of designation or some area not designated at all. The truth of the matter is that the English countryside, of which we are so proud, has a sort of seamless continuity. The fact that we have quite different legislation for different forms of designation and different funding arrangements simply accentuates the inconsistency of our approach to managing those parts of our countryside which we value. This was made inevitable by the very nature of that legislation in 1949 and those who framed the legislation very carefully made it clear that the administrative structure for national parks was to be completely different to the administrative structure for AONBs with completely different funding arrangements. Although the planning powers were similar in some respects, the planning administration was very different. The Minister will hear others, I am sure, talk about resources which are clearly different.

Having recognised the problems that AONBs have had to address, it is only fair to point out the minor improvements that resulted from the Countryside and Rights of Way Act 2000 in which my noble friend played an important part. There are now statutory management plans. There is government guidance on a number of measures, particularly on how organisations whose activities impact on protected areas should consider their obligations in AONBs. We have heard about Defra’s sustainable development fund which very often gears funding of considerable proportions from elsewhere. The Countryside and Rights of Way Act allowed for the conservation board which had already been rolled out in Sussex as a precursor or trial. Conservation boards have now been rolled out elsewhere, as my noble friend Lord Plumb told us, not least in the Cotswolds. But these inherent problems remain. Most people understand the nature of a national park. You know when you have driven into a national park because it is usually evidenced; the identity of national parks is well understood, appreciated and valued. However, it is not always clear when you have entered an AONB, or even if you live in an AONB in some cases. There is no linkage, or inadequate linkage, with conservation bodies and biodiversity action plans. Local authorities have biodiversity action plans but they operate rather removed from the AONB structure. We have heard how important conservation of the built heritage is in AONBs but again this happens almost as a separate exercise, not inevitably connected to the activities of the AONB, although it will of course get a mention in the management plan.

Education and the creation of new jobs and appropriate skills within the protected landscape are quite difficult issues to mesh into the concept of an AONB with this very limited resource and management structure. I have not read every statutory management plan but I would assume that each one talks about contributing positively not just to the rural economy but to the quality of life of those who live there and the quality of the environment in a way that is compatible with the protected landscape. This is the challenge for all who try to ensure that protected areas conserve what we value—and visitors expect things usually to remain as they were on their last visit—without making it a handicap and a hardship to have to try to earn a living there.

Planning powers are, without doubt, important. They should help to prevent unsuitable development, although many would complain that they have not always done so. In a sense it is the stick rather than the carrot, but equally important to the stick is the carrot. If there is to be a champion for each AONB, if there are to be organisations like the conservation boards and the management boards about which we have heard today, they need to be able to champion new markets for the products of this protected landscape. They need to champion ways in which education and tourism that is compatible with these protected landscapes can be promoted. They need to champion better conservation practices than those in the generality of the wider countryside.

Yet we have heard from my noble friend Lord Plumb just how large these organisations must be, taking in as they do a wide range of local authorities and other interests. I forget just how many people my noble friend said sat on his committee, but it seemed a rather unwieldy organisation. I think the Secretary of State appointed 15 members. The climate change committee, which the Minister successfully steered through this House, has only eight members, with perhaps two or three to come. That suggests a rather more appropriate management structure for championing these areas of outstanding natural beauty without trying to reconcile a large number of bureaucracies, local authorities, NGOs and other interest groups. That is not to say that they should not be represented. I am sure there are other ways of ensuring that they can participate in dialogue and discussion, but ultimately there must be someone who champions areas of outstanding natural beauty and who owns the problem.

The problem, as I said before, is to ensure that all who have an interest in these areas of outstanding natural beauty, whether because they live there, work there or visit there, recognise that to be within the area of outstanding natural beauty could give them an advantage denied to others. We are a long way from that concept at the moment. Realistically, many people who try to earn their living in these protected areas feel that they have to jump over more hurdles than others do in order to get planning permission for developments, even if it might be seen to be in the long-term interests of the economy.

My own area is heavily wooded. Some 25 per cent of it is wooded, which is much more than the Cotswolds AONB. As noble Lords may know, the south-east of England is the most heavily wooded area. A lot of these woodlands are quite frankly derelict. In the 19th century, they were managed for charcoal burning. A whole range of products came out of these woods. It was very labour intensive but was an important part of the rural economy. That dropped by the way as charcoal was no longer needed, and there was not the money or the income stream to manage these woodlands properly. Now, however, an opportunity is staring us in the face—biomass in the form of woodchips, and the use of combined heat and power.

To get this going, however, you need to put together an awful lot of players in the field. You need planners, district heating schemes and the public procurement of schools, hospitals, government offices and the like. If they commit themselves to CHP plants, people will go back into the woods to manage them and produce by-products—we are not talking about timber—on a large scale for use as biomass. That is precisely what parts of our areas of outstanding natural beauty need. They need markets, not subsidies—they do not need more money from Defra. They simply need long-term strategic thinking, with a board that understands the objective precisely, and plans that can be implemented over years, not months. In a modest way, this is precisely the sort of long-term strategic direction that we talked about in our debates on the Climate Change Bill. There should be one for each AONB. It should not be an organisation in which every local authority and interest group has to be represented. It must be an organisation that can actually deliver; that can stand up and say, “You are now living in an AONB. We are going to make you proud of it. We will give you opportunities which others would love to participate in”. When we have made an AONB something that people can buy into and be proud of and do not see as just another planning obstacle, we will no longer talk of areas of outstanding natural beauty, as we are in this debate today, as the Cinderellas of the protected designation systems.

My Lords, I live in an AONB—the Suffolk Coast and Heaths AONB—and as I shall illustrate, my experience suggests that insufficient attention is being paid to this designation by the various offshoots of government, including at times, I regret to say, central government. By contrast, our county council in Suffolk has done its best to help us with its limited resources.

I have one success to record and one serious current anxiety. The success concerns the attempted sale, 10 years ago, of a former military airbase, Bentwaters, within the AONB, not far from Woodbridge in Suffolk. During the Second World War the Royal Air Force built this airfield, intending it for use by fighter aircraft in defending us against attack by enemy bombers. It was not used for long and, with the arrival of the Cold War, was taken over by the American air force, the USAF, which had a second runway nearby, at what is now designated RAF Woodbridge. The Americans deployed a light jet bomber, the A-11, and its Cold War mission was to be available to attack Russian tanks should they start rolling across central Europe. That makes one realise how far we have moved on since then.

Of course, this never happened, but the aircraft from these bases were used with devastating effect to destroy the Iraqi tanks as they withdrew from Kuwait in 1991. The A-11s never came back to Suffolk, but returned, as the Americans say, Stateside, and the Bentwaters airfield became redundant. Inevitably, the Bentwaters runway had just been resurfaced to the highest standards, at a cost of several million pounds. Understandably, perhaps, the Ministry of Defence then put the airfield on the market, hoping that it could be sold profitably as a commercial airport, for the benefit of their always-stretched budget. A private deal was done with the local district council to permit such a development, with a suspicion locally that some of the MoD profits might eventually accrue to the district council. The device was called a planning brief—a suspect document. My recollection is that little or no mention was made in this documentation of the fact that the airfield was in the AONB.

At this point, my wife, who was a member of the county branch of the CPRE in Suffolk and active in planning matters, became involved. Her strongest argument—surely right—was that a commercial airport in the AONB should be out of the question by definition. She was helped by the fact that she had been brought up locally and spent some time between school and proceeding to Cambridge as a classical scholar working as a clerk on Orford Ness during the Second World War, where numerous important military experiments, including radar, were taking place. Her approach was to remind the public authorities of the AONB designation, of which most seemed quite unaware, and to speak always in a quiet and reasoned manner, with strong arguments. This was exactly the right style to convince local opinion and it was, in the Latin phrase,

“suaviter in modo, fortiter in re.”

It also helped her case that the former Royal Air Force base at Horsham St Faith in Norwich was being developed by a number of airlines, notably KLM, as a commercial airport, and Stansted was being planned. Finally, our local Member of Parliament, Mr John Gummer, who was always very clear-headed about these environmental issues, informed a meeting, which he convened one Sunday evening, that the enthusiasts for the airport had lost their case: there was no commercial support for it. The scheme was dropped, but there had been no considerable—or indeed any—visible support from central government in defence of the AONB in this argument.

More recently we have been facing a different threat, which concerns me very much because of the Government’s decision to stop spending modest sums—a small contribution—to help to repair the walls of our tidal river, and their willingness to abandon large tracts of the coastline in the AONB to the sea, as I shall explain. I live 16 feet above sea level in the coastal village of Orford. I have 1.5 acres of orchard and garden and am not engaged in agriculture. The key to the problem is our tidal river, variously called the Alde and, in its lower reaches, the Ore, which flows from the west, in Snape Maltings, to the east, until reaching the coast at Aldeburgh. It then turns 90 degrees to the south to run parallel with the coastline from which the river is divided from the sea by a shingle spit—an unusual feature; it is Europe's longest vegetated shingle spit and has a certain fame among geologists. The river finally enters the sea at the mouth.

There are various critical points. The first, just south of Aldeburgh, is where the sea broke through in the last serious floods in 1953 and did much damage. There is a fine Martello Tower, one of the largest in the series and a listed building. This place is called Slaughden. The river then continues 15 miles or so southwards to Shingle Street where it enters the North Sea. The river wall on the land side has been steadily maintained and the drained marshland behind it produces valuable food crops and is home to flocks of cattle and sheep. Your Lordships may care to be reminded that in most years we in this country are a net exporter of wheat and barley malt.

However, the organs of central government seem to have decided to abandon this terrain for reasons which are not altogether clear to me. Plans are being discussed to make a deliberate breach at Slaughden, which means goodbye to the Martello Tower, and to create a new tidal stream moving south towards Orford and Shingle Street against the incoming tide. The effect will surely be to silt up the river and that will lead to the loss of Havergate Island, a prized site owned by the Royal Society for the Protection of Birds, which has contrived to persuade the avocet to make its home there. The avocet has been adopted by the RSPB as its national logo. Do the Government really want to have an open argument with the RSPB, which has millions of members who are very vocal?

I remind the Minister that Her Majesty's Government have given the National Trust £1 million in the past decade to preserve Orford Ness, particularly as a habitat for numerous rare birds. Another loss would be the Orford Ness Lighthouse, which would be damaged by the changing pattern of water in the estuary. I therefore consulted officials in Trinity House to see whether they were aware of the danger to this lighthouse and found—surprise, surprise—that no one in central government nor in the local authorities had troubled to inform them. Trinity House attaches importance to the continued existence of this lighthouse because of its role in guiding ships carrying oil from the northern isles to the Thames estuary.

I have derived the impression—I regret to say a clear one—that some government departments in London have little or no understanding of the AONB designation and its scientific importance. I venture to suggest to the Minister that the Cabinet Office might be invited to send round a letter to all departments at a fairly senior level to remind them of the existence and relevance of the AONBs. I find it frankly amazing that a team organised by Defra is now making plans which would destroy our AONB and cause it to be overcome by the sea. I am grateful to the noble Lord, Lord Renton, for making it possible to have this short debate, and I rest my case.

My Lords, I am very glad to have the chance to follow my noble friend and neighbour in speaking on this subject and I take this occasion to pay a heartfelt tribute to his late wife, Rachel Bridges, who did an enormous amount to conserve and protect the Suffolk countryside.

I have been involved with AONBs for many years. First I was a member of Countryside Commission for 12 years from 1980 to 1992, and then I was chairman of CPRE from 1993 to 1998. Since 1997, I have been president of the Suffolk Preservation Society. I am also a farmer in Suffolk in a special landscape area adjacent to one of Suffolk’s two AONBs. I am therefore delighted that my noble friend Lord Renton has secured this debate. It has enabled us to have the esteemed presence of the noble Lord, Lord Rooker, who is one of the most valued Members of the Government to the Government and of this House to this House.

The importance of the subject is obvious. We live on a small, crowded, but still very beautiful island. This means that we have to protect and, where possible, enhance the beauty of the countryside by every means that we can. With the growth of population, the pressures become ever greater. Our Select Committee on Economic Affairs in its excellent report, The Economic Impact of Immigration, published this week, states at paragraph 181:

“For example, the English countryside is an environmental amenity of great value and a substantial rise in population, however caused, is likely to diminish it. Rising population density will also increase the demand for infrastructure including roads and airports, decrease the … living space available … for public parks and green fields … Different people will have different views about whether or not an increasingly crowded environment is desirable”.

I suspect that most of us here are of one view on that question. The committee points out that the present UK population of 61 million is now projected to grow to 71 million by 2031.

There can be few greater obligations on our generation than to hand on a beautiful countryside to our children and grandchildren. We cannot protect everything, which is why it has been crucial to have a hierarchy of landscape. Such a hierarchy, combined with the new planning system, the need for which had become so apparent between the wars, was established by the post-war Attlee Government. Together with the National Health Service, it was one of their two great legacies.

Today that hierarchy encompasses national parks, AONBs, heritage coasts, special landscape areas and conservation areas. All of these are crucial. In addition to the planning arrangements, one great bulwark for conservation is of course the National Trust which, with its gigantic 3.6 million membership, owns more than 600 miles of England’s most special coastline. It is attempting to acquire another 300 miles, because, frankly, the coastline is perhaps the most vulnerable of all parts of our island, and once it is gone, it is gone forever. I would not trust any owners in the way that I would trust the National Trust. At this stage, I should remember a former colleague of ours, Nick Ridley, who—ex cathedra, when he was Secretary of State for the Environment—made a very important statement that it was government policy to protect the countryside for its own sake.

Perhaps the most urgent question on which I hope the Minister will shed some light is whether the planning Bill, which I assume will reach us in the summer, will invalidate in any way that crucial PPS 7 on sustainable development in rural areas or Section 85 of the CROW Act, to which my noble friend Lord Selborne referred. We cannot allow the protection given by that earlier legislation to be trumped by new planning Bill measures.

The funding of AONBs has been mentioned by several noble Lords, particularly by my noble friend Lord Plumb. We must not forget that the funding provided for national parks includes an element to cope with the recreational role of the parks. That was one of the functions for which the parks were created. The noble Lord, Lord Bragg, spoke very beautifully about that most beautiful of all areas. Only this morning I was listening to a lecture from him on Newtonian physics. I understood his speech better than I understood the Newtonian physics.

AONBs, however, were created solely on their landscape merit. There are now increasing recreational demands on AONBs and this certainly applies to Dedham Vale in Suffolk—Constable country. These demands must be welcomed, but their management must be funded. At present, some 75 per cent of AONB funding comes from Natural England. As the Minister knows, DEFRA has cut the Natural England budget.

Europe also has a part to play. I am glad that the Government last year ratified the European Landscape Convention. I hope that one day it will be converted into a directive, given the great contribution that the habitats directive has played in conservation. We in the United Kingdom have a great deal to teach our European neighbours about the protection and conservation of the countryside. Of course, the United States was at the forefront, inventing national parks in 1908 or even earlier, about 50 years before we did. Americans look after their national parks wonderfully well, but unfortunately seem to regard the rest of the landscape as largely expendable and are doing some pretty awful things to it. On this relatively small globe, no landscape is expendable.

I mention a point raised by the noble Lord, Lord Bridges, about the threat to our coastline. The view of the Environment Agency seems to be that everything should be abandoned to the sea. It is out of touch and out of date. First, we are moving into a period of world food shortage, which is being greatly exacerbated by turning over much agricultural land to the production of biofuels. This is separate from the threat of global warming, which I discount quite heavily.

Secondly, some of our most precious landscape would be lost without coastal defences, which need a much longer planning horizon. This is nothing to do with global warming or climate change, which of course does exist. Coastal defences need a much longer time horizon than any political or planning timescale. Somebody told me today, when I was discussing this debate, that we should think in terms of 100 years when planning coastal defences. Certainly, some of our continental neighbours do that. This applies particularly to our Suffolk Coast and Heaths AONB.

Suffolk is aiming to be England’s greenest county. Apart from protecting our wonderful countryside—and I join in the tributes to Suffolk County Council—I hope that our particular contribution will be to welcome two new nuclear power stations at Sizewell. I am at one with the noble Lord, Lord Bragg, in recognising and welcoming the huge importance of nuclear power in filling a gap that will otherwise turn out the lights. I am afraid that playing around with renewables such as wind power is, to a significant extent, political tokenism that cannot begin to deal with the problem. The Government have left the launch of a new nuclear programme almost too late. Others, especially China, are making great demands on a limited nuclear construction capability and Britain must book a place in the queue.

A special quality of our AONBs should be tranquillity. Noise, like light, can be immensely polluting. Neither is as long term—and certainly not as irreversible—as pollution by concrete. None the less, they counter quiet enjoyment, which is one of the aims of AONB designation. We all recognise that the military has to have low-flying training for war operations and we should play our part in that with pride. However, civil aviation is another matter. We in Suffolk worry about the expanded air-stacking area that is expected to be part of the expansion of Stansted. I ask the Minister to consider the possibility of stacking aircraft over the sea, rather than over land—in our case, that would be the North Sea.

Finally, I should like to add to what my noble friend Lord Selborne said about the crucial contribution made to AONBs by the world of volunteering. Many of them, for example, have volunteer wardens, and the Government should demonstrate their appreciation of this by supporting AONBs in every way they can.

Those of us who are very privileged to be lifetime stewards to small pieces of England’s countryside have an obligation, through hedge-planting, tree-planting, digging ponds, the sensitive conversion of redundant farm buildings and housing and so on, to see that when we depart from our patch, it is more beautiful than when we arrived.

As I said at the start, the Labour Party can claim proud parentage of much of our conservation legislation. It would be sad indeed if during the last couple of years of its present period in office, it were to renege on our national heritage. However, that is a subject for wider debate and I have a lot of confidence in the Minister.

My Lords, I, too, am most grateful to my noble friend Lord Renton for initiating this debate. He, like other noble Lords who have spoken, has hands-on experience in the structure and management of AONBs.

My noble friend Lord Marlesford reminded us just how overcrowded this island is. It is the most densely populated country in Europe, with the exception of Belgium, and that is without the huge increase in population that can be expected in the next 10 years—that is not a party-political point of any kind. Areas of outstanding natural beauty cover a surprising 15 per cent of the whole land area of England. It is vital that these tracts of land, set up through the foresight of previous legislators, are cherished. It was nice to hear the tribute paid by my noble friend Lord Selborne to the part played in this by my noble friend Lord Renton. However, it is a sad fact, and one that has run through this debate, that money is at the heart of many of the problems with AONBs. I shall refer briefly to three of the imaginative schemes that are in danger of failing because of the lack of funding.

The East Devon AONB management has a scheme called Parishscapes. This is a project funded by the Heritage Lottery Fund to digitise all the tithe maps covering the AONBs so as to improve public access. The project works with local schools and includes the creation of oral accounts of landscape change through local community contacts. It has taken two years to develop, originally with the help of the former English Heritage. It is, in short, a scheme that will benefit young and old alike.

The funding structure is typical of many AONBs—a three-year commitment by the local authority and the Heritage Lottery Fund. Without the help of Natural England funding, however, the project is in danger of failing. The local NE officers—the unfortunate messengers in all this—are just not in a position to give a definitive answer about this year’s funding, commencing this month, and the funding will in any case be for only one year. Not unnaturally, that has unsettled the local authorities, which not unreasonably are looking for a longer-term commitment from Natural England.

Perhaps I may give an example from another part of the country. The North Pennines AONB has two major projects. The Peatscape project involves the blocking of 200 kilometres of moorland drains—or, as I am sure the noble Lord, Lord Bragg, will correct me, “grips”, as they are known up there. Incidentally, that will be done with dams built by dry-stone walling apprentices, thus fostering and encouraging a precious north of England craft, although I have to acknowledge that my noble friend Lord Plumb also referred to a similar craft, and indeed training, in the Cotswolds. These dams will keep the peatlands as functioning wetland ecosystems, allowing them to store carbon, reduce the impact of downstream flooding, conserve biodiversity and reduce water colour, so there are a good many ticks in boxes there. It is estimated that the peat, which would otherwise have dried out, would have released carbon equivalent to 72 years of emissions from the Drax power station. That is the degree to which the wetlands will contribute to the saving of carbon emissions.

Another example is the Hay Time project, which is doing valuable work in restoring upland hay meadows. On a technical note, I should add that both these projects, funded by Natural England through the AONB bodies, meet PSA targets that Natural England itself could not—and this must apply to many similar projects up and down the country. Natural England funding binds projects together, giving them a chance to “buy in”. Crucially, it allows managements to generate levels of matched funding. It is the shop window to justify the value of the Government’s investment in these AONBs.

My third example has international dimensions. South East Protected Landscapes has been working with Kent Downs AONB—the AONB has a particular problem because it has five urban projects within its area—to develop a truly international partnership with the parc naturel around Paris and its equivalent regional organisation, Ile de France; with two universities, Kingston in England and Versailles in France; with protected landscapes around the German capital; and with the South East England Development Agency and Natural England. The strong educational element qualified it to call on the SDF, which will be crucial in applying for matched funding elsewhere to build a strong international tertiary sector.

The comments of this project’s leaders speak for many. They complain about the uncertain level of funding, its short-term, annual nature and, once again, how late in the year the current budget is announced. As with East Devon, there was no official confirmation of the 2008-09 funding for the Kent project at the end of March, a point to which my noble friend Lord Renton has drawn attention.

These are but three examples of the work of AONBs. I hasten to add that I have seen many more submissions from managers up and down the country. Time does not permit me to mention them all, but I have chosen three that give an example of the wide—and, if I may say so, heart-warming—diversity of projects, which were conceived with imagination and dedication, in virtually every case on shoestring budgets, and, as many noble Lords have pointed out, with that devoted band of volunteers without whom they could not continue.

This all leads back to Natural England’s funding difficulties, but, sadly, it goes further back than that—to Defra. One has only to mention the list of disasters that have had an effect on Defra’s ability to fund: the disastrous overspend on the Rural Payments Agency, the Pirbright foot and mouth scandal and the fiasco over the single farm payment scheme, which resulted in an EU fine of £63 million. A cash-strapped AONB manager does not have to be a cynic to reflect that, had it not been for that fine, he might have had some of that money. Natural England, together with the AONB projects that it supports, is but one of the sufferers of all this mismanagement.

It is said that there are no votes in prison building. Sadly, there are precious few votes in conserving and cherishing our AONBs. However, I urge the Government to reverse some of the decisions that threaten further to undermine the quality of our rural infrastructure and natural environment.

My Lords, I should first declare that I am president of Friends of the Ridgeway and of the CPRE in Oxfordshire and that I live right on the boundary of the Chilterns AONB.

I will talk about national trails. These have not been mentioned in the debate so far, but there is work going on to consider their future. They are the long footpaths that traverse much of the AONB land. They are the network that should be at the heart of our strategy to encourage the public at large peacefully to enjoy the countryside. They should be the gateway through which people have access to the countryside and what it has to offer, be it nature, history or healthy recreation. They should represent the best walking routes in the country through a good cross-section of different terrain, to which many noble Lords have referred this afternoon.

I will not labour the benefits of national trails—the health benefits, the climate benefits, the educational benefits, the economic benefits and the social benefits. There is a tremendous opportunity to increase the use of these trails. Many noble Lords have referred to the fact that this is a very crowded island. I could lay £5 on the table and say, “I can take you to a place on the Ridgeway where you can see for miles in any direction and there will be nobody else there”. Why is there nobody else there? Partly because access to that network is extremely difficult. The noble Lord, Lord Renton of Mount Harry, said that you could take a bus from Brighton and walk four or five miles through the AONB and catch another bus back. I am afraid that the Ridgeway runs through parts of the country where a bus is something of a rarity and certainly does not offer any sort of regular service that people could plan to use. In any long-term strategy, we must look at access. People want to get out of towns but they need to be able to; if they come in a car or on a bike or whatever, there must be somewhere for them to leave it.

The threat to the national trails is almost entirely a question of funding. There is a huge body of volunteers. Friends of the Ridgeway is one such body; it does enormous work to publicise the place and improve it. I pay tremendous tribute to the Government and the noble Viscount, Lord Bridgeman, for the work done in this House to rid the Ridgeway of almost all mechanically propelled vehicles, which were almost destroying it. The joint efforts made in that respect were a manifestation of what can be done without spending a huge amount more money; it was a question of changing the law and a bit of enforcement. That was much helped by volunteers.

Whatever the amount of money the Government put in, local authorities, trusts and people will put in money to match, and it will grow. We are asking the Government more about putting down the seedcorn than about harvesting the crop. There are national trails officers who effectively manage the trails, but such people are extremely thin on the ground. We have to address how much the existence of national trails and their advantages—and the advantages of the things looked after by English Heritage, the National Trust and the AONBs—are in the tourist literature. Do we encourage the people who come here, or those who live in cities, to know about these areas and visit them? Despite what is said about the island being terribly overcrowded and about pouring concrete over the whole of England, that is not the case in large areas of England.

My second point is about noise. Noble Lords have probably seen the maps that the CPRE has produced over the years showing ever shrinking green areas; they are quiet areas or tranquil areas, as I believe it calls them. The noble Lord, Lord Marlesford, has already referred to the fact that people in, I believe, Suffolk are concerned about the expansion of Stansted and the rerouteing of aircraft approach paths over Suffolk to Heathrow. The threat of aircraft noise is substantial. It would be devastating in the Chilterns AONB. NATS, in its wisdom and in its efforts to get more aircraft into Heathrow Airport, seems to be almost oblivious to the areas that aircraft are flying over. I have asked Written Questions about the extent to which direction is given to NATS to avoid certain areas. I have more or less been told that NATS has to make the best judgments, that space is limited and so on. I would rather like to see a positive direction given to NATS to try hard to avoid certain areas; flight paths across the country should avoid those areas. I am afraid that some of that loss of tranquillity is due to the growth of recreational aviation taking people on holiday. Both the climate change and noise issues that we face must come smack up against the issue of how much cheap flying we can afford without tremendous detriment to the area around. The question of new runway capacity at Heathrow will be a cause célèbre and it will bring a great deal of protest about noise.

I now want to jump to the A30 in Devon. I do not know whether the Minister in his various travels has driven from the Salisbury area to the Exeter area. The noise from that road is horrendous. It is not just the noise that one hears on the road; one can go two or three miles to either side and the noise is continuous and horrendous. There are remedies for that. The surfaces of roads can be treated with what I believe in the trade is called “whisper asphalt”. In fact, a piece of the A34 north of Oxford, which was also a concrete road like the A30, has been treated with whisper asphalt and the noise has been reduced substantially.

If we want tranquillity we have to control the transport. It is certainly possible, as I know, to control the noise on railways and I believe that it should be done, but at least railways do not have the disadvantages of all the things that are on the edges of roads—you do not have a McDonalds every few yards or a Little Chef or a garage or whatever. Some railways, such as the Settle to Carlisle line—the noble Lord, Lord Bragg, may or may not agree with me—add to the environment rather than detract from it.

I am looking to hear from the Minister about not necessarily generous funding but a steady stream of funding looking to the future. I would particularly like him to say something about supporting the rural community councils. Those are small bodies in the counties that look after things such as rural housing and the generation of businesses in localities. They also give advice on opening rural shops and so on. They do a great deal of work to support the community, but they are thinly funded. They are not well paid and they are not overstaffed. I would like the Minister to say something positive about the possibilities of promoting tourism and access to the many beautiful areas that we have. I am sure that that can be done without destroying them. I am sure that many children, as has been mentioned, would benefit from getting out into the open air and finding their way into these places. I am not pessimistic in that I do not believe that the demand for more housing is necessarily inconsistent with the promotion of areas of outstanding natural beauty. I am sure that, as the noble Lord, Lord Bragg, said, the demand for open space on our island will and should grow. We should be proud of what we have rather than seeing everyone wishing to fly out of the country and disturb everyone else.

My Lords, the noble Lord understates the massive leadership he gave during the passage of the NERC Bill to secure the control of mechanical vehicles on rights of way.

My Lords, I join other noble Lords in congratulating my noble friend Lord Renton of Mount Harry on securing this debate today. Although noble Lords have said that much of it comes down to money, at least we can go away to our Recess having had the opportunity of talking, even waxing poetic, about something which is part of our national heritage and of value to us all.

When parliamentarians speak about security or safeguarding the nation, it generally has something to do with military or foreign policy—protecting British borders and a British way of life—but all too often it seems that we forget the British landscape, our countryside, which is as wrapped up with the British way of life as the rights we have defended and the culture we have inherited. It is truly a,

“precious stone set in the silver sea”.

What can be more important in the recognition of our country’s identity than the demarcation and preservation of areas of outstanding natural beauty? One does not have to be a Romantic poet to recognise that our landscape in so many ways defines that which we see as the core of our national identity: the land, the territory, the countryside itself. It is thus absolutely essential that these areas that embody the most beautiful aspects of our landscape are properly managed and protected. As my noble friend Lord Renton and other noble Lords have said, they exist for all of us whether we are a city dweller, a townsman or a countryman.

Before delving into some of the specific questions, it is useful for us to understand the broader context of the environmental importance of areas of outstanding natural beauty. My noble friend Lord Selborne showed how important this can be for future strategy. According to the National Association for Areas of Outstanding Natural Beauty, the definition of such areas is,

“a precious landscape whose distinctive character and natural beauty are so outstanding that it is in the nation’s interest to safeguard them”.

However, natural beauty is not a straightforward concept. It does not mean wild or primeval, as the Countryside Agency's guide to managing them acknowledges. According to the Countryside Agency, the statutory definition of natural beauty includes flora, fauna and geological and physiographic features, but it recognises that AONBs are man-made cultural landscapes.

Much of the success of AONBs has been the way in which they have worked with farmers, landowners and others working and occupying the land to maintain the dynamic of a living and working landscape. AONBs are not museums. They have maintained a pragmatic relationship and have sought to work through consultation and advice rather than prescription. In this respect they are widely seen as having a better relationship with those who live and work in them than the national parks.

The history of this island’s inhabitants is inextricably linked to our landscape. There is not much nature in the UK that is not the result of hundreds of years of human modification and influence. Any country’s landscapes are dynamic. They are changing and being changed. From Hesiod to Hardy we see examples of the way farming, forestry, settlements and local communities have had profound and beneficial impacts on the beauty of the countryside. Yet not all change is welcome. The threat of global warming and the more immediate dangers of poor upkeep threaten these areas of outstanding natural beauty. If what is special about them is to be preserved, the greatest care must be devoted to sustaining them.

My noble friend Lord Renton has shown how important these areas are to our national environment. There are currently 36 designated areas of outstanding natural beauty that cover about 15 per cent of England. Under the National Parks and Access to the Countryside Act 1949, recreation is, unlike in the national parks, as the noble Lord, Lord Marlesford, said, not a statutory objective, although it is encouraged in so far as it is compatible with the primary aim of designations: conservation. The noble Lord, Lord Bragg, showed how important the balance is between conservation and access in the life of the Lake District National Park.

The Countryside and Rights of Way Act 2000 brought in new measures to help protect AONBs further. Local authorities were given greater responsibilities for the management of those areas; thus there are frameworks for their protection. However, they were set up almost a decade ago. Considering that legislation to protect those areas was last passed in 2000, what plans does the Minister have to legislate in the near future?

My noble friend Lord Selborne reminded us of my noble friend Lord Renton’s role in the CROW Act, which enables the creation of conservation boards for individual areas where there is local support. The boards take over the management plan and other aspects of managing the area. Natural England and local authorities must be consulted in their creation and people with appropriate skills and knowledge are to be appointed to the board. Can the Minister tell us about the success of those boards in preserving AONBs? Has there been any review of their success? Does he consider the scheme a success in general? How many such groups and boards are currently being funded or will be in future?

As my noble friend Lord Bridgeman, among many others, told the House, uncertainty of funding can create great difficulties. Funding is a key issue when it comes to preserving our environment, and not one that I expect that the Government will be very keen to talk about. Frankly, what has happened has been disgraceful. Let us consider the plight of Natural England. In 2004, following a review of rural delivery carried out by the noble Lord, Lord Haskins, Defra published its rural strategy. As part of that strategy, a new body was created called Natural England, formed by the merger of the Countryside Agency, English Nature and the Rural Development Service.

Natural England was formally established on 1 October 2006. Just after it was established, Defra Ministers were forced to cut budgets to the tune of more than £200 million in 2006 and a further £270 million in 2007. Further cuts mean that Natural England has been asked to cut its budget by £12.5 million for 2008-09. That could have disastrous effects on the preservation of our natural landscape. What will be the impact on areas of outstanding natural beauty? Is the Minister not concerned that the Government are jeopardising their alleged commitment to promote biodiversity and conservation? Can he assure us that the Defra cuts will not have a negative impact on the grants issued by Natural England that currently support those areas across the country?

What has happened is a cause for distress. As soon as the Government gave Natural England the breath of life, they tried try to choke the funds out of it. Indeed, the director of conservation at the Royal Society for the Protection of Birds put it just that way, saying:

“Natural England was set up by the Government and now it looks as if it is being strangled”.

That seems an entirely fair assessment of what has happened to Natural England. What about the future, as my noble friend Lord Plumb asked? Given the consistency of those budget cuts, can we expect the shrinking of Natural England's budget to continue? Considering the growing importance of conservation and drives to include further protected areas, is the Minister prepared to give up on the development of a serious conservation agenda?

The most disheartening thing about the budget problems that are currently plaguing Defra is that they were avoidable. I have no wish to rehearse the usual litany; the department’s mistakes have been acknowledged by the Minister many times. However, Defra’s crisis is real. Mismanagement, particularly of the Rural Payments Agency and the subsequent fines imposed, is putting the environment at risk. It is unfair that many excellent schemes have been, or are at risk of being, cancelled simply because of the deficiencies within the Government. These self-inflicted wounds have been made worse by the fact that the Government as a whole, despite all the extra stealth taxes they have raised, appear to be running out of money, and the Treasury is looking for further cuts. Do Defra and its budget continue to be at risk?

To protect the future needs a more holistic approach. I see the future funding of AONBs not as a party political matter. We must seek to incorporate a range of bodies at local, regional and central government levels. There also need to be further efforts to encourage private organisations and individuals. Do the Government have any specific schemes to do that?

The issue of individual involvement is pertinent, and one that the Government have evidently not considered carefully enough. They need to consider it further. While we have been talking about the importance of the ways in which people can impact the environment, I want to close with the corollary that is too often ignored; that is, how much the environment can impact on individuals and their lives. There is a substantial cultural dimension to the natural world that we inhabit; indeed, part of the process of civilisation is a constant attempt to make sense of our environment, to understand it scientifically, to depict it beautifully and even just to contemplate our place in it. To preserve the natural beauty of this country is to preserve its culture.

As the right reverend Prelate might have said, the psalmist long ago commanded us to lift up our eyes unto the hills, from whence cometh our help, but I am reminded more of Wordsworth, who was the first to open our eyes to the world around us. I will not quote “The Daffodils” as a way of declaring my interest in today’s debate, but I will quote from a lesser known poem, “Michael”:

And hence this Tale, while I was yet a boy

Careless of books, yet having felt the power

Of Nature, by the gentle agency

Of natural objects led me on to feel

For passions that were not my own, and think

At random and imperfectly indeed

On man; the heart of man and human life.

All of us, in the humanity we have in common with those past and yet to come, are capable of similar revelations. That is why we are right to seek to protect our most outstanding landscapes as a daily reminder of our place in the natural world, and indeed in creation.

My Lords, this has been an excellent debate, and I congratulate the noble Lord, Lord Renton, on securing it and on his choice of subject. A lot of questions have been asked and points made, and I shall do my best to respond to as many as possible. I will seek to write regarding those that I miss out. As I go through, I have counted about five declarations of interest that I will have to make in responding to various issues.

I want to put a couple of facts on the record. Natural England’s settlement for 2008-09 is £176 million. No one mentioned that. Up or down, it does not matter; that is the figure. It is flat cash compared with last year, with a £5 million efficiency saving that was built in. I understand that that came about as part of the efficiency savings that would be expected from the merging of three separate organisations. There was some long-term planning, which others in the House will be more familiar with than I am because I was not at Defra at the time the legislation went through. At present Natural England is on record as saying that it was a good outcome for the natural environment, but it is not yet able to say what the funding is this year. I regret that as much as anyone else. It has had board meetings relating to this, and I accept that there are some hard choices to be made. It is in everyone’s interests, including those of the Natural England board members, to get decisions out as soon as possible. There is a contrast there with the national parks. Because they are effectively quasi-local authorities, they have to set their budgets in advance like ordinary local government, which are duty-bound to fix their rates or taxes in advance. That difference goes to the very point that the noble Earl, Lord Selborne, made about differences in the administration of these bodies.

One thing that I can say, and it might answer a couple of questions asked by noble Lords, is that they are considering three-year settlements for areas of outstanding natural beauty in order to provide more stability and certainty. That is important. The delivery of Defra’s policies is undoubtedly devolved to Natural England. We cannot micro-manage them from Whitehall. That would be completely wrong. The man and woman in Whitehall do not know best; there is no doubt about that.

Natural England is spread over the country to take the decisions appropriate to the particular areas, even the areas that are run by the conservation boards. There are only two conservation boards, for the Chilterns and the Cotswolds. It is up to the constituent parts of the areas of outstanding natural beauty to decide whether they want a conservation board. It is not for Defra to impose them.

I have to get another point out of the way before I am accused of missing it out. I cannot say anything whatever about the proposed South Downs national park. I have all the fancy words here in bold: “quasi-judicial”; “prejudice the Secretary of State’s decision”; “essential that Minister’s officials to do not engage in public discussion on the issue”. But I can say this—and then I can get it off my chest. I remember the announcement, in 1998 or 1999, of two new national parks. I think it is appalling. It is not a credit to democracy that, in 2008, we still do not have one of those. It is not a credit to say, “It takes a long time”. I regret the lapse in standards of administration and democracy and the fact that no decisions have been made. But a second inquiry is still under way and I cannot say anything about the detail.

My Lords, I totally understand what the Minister has just said. I, for one, was certainly not expecting any statement today on the national park. However, I am very glad to hear the rider that he added, that it is absolutely extraordinary that the first preliminary decision to turn the South Downs into a national park was taken in 1999. It is amazing that, eight years later, that has not been finalised. I would only like to put on record that it makes life difficult for the loyal staff who work for us on the South Downs Joint Committee.

My Lords, it also blights the economy and investment plans for the future. It blights all kinds of plans for the area. It blights the quality of life for everybody, whether they live in the countryside or the towns or whether they live or work there. It is no service to the community that it takes so long. I am not making the case that positive decisions should be pushed through. I am simply saying that delaying the decision is a disbenefit to people in all walks of life. As I say, I cannot say much more about it . I think that I have said enough.

I will not go over Defra’s budgets; they are well known. I make my own modest contribution. Yesterday, in going to address a major international conference on the CAP, I used a London number 24 bus. I did not charge Defra for the journey because I used my bus pass. We are making contributions. I banned Christmas cards from Defra Ministers when I arrived there and they are now done electronically. Those are not tokens. We simply had a look at what we were doing, bearing in mind that we had to make cuts to our agencies and difficult decisions had to be made. However, the decisions on the budgets for the areas of outstanding beauty will be made as soon as possible.

A well-rehearsed speech has been drafted for me on the assumption that certain points would be made but I think it would be better if I tried to pick up some of the points that speakers made and then go back to my notes if needed. The noble Lord, Lord Renton, was right to say that he had been asked to raise a little noise on behalf of the areas of outstanding natural beauty, and I think that he has done that. I can assure him that the message has been heard loud and clear in the department.

The noble Lord specifically raised one point. As the common agricultural policy changes, Pillar 1 direct payments will go, sometime between 2015 and 2020. The key will be to get as much of the money as possible into Pillar 2 for rural development and the wider rural economy. Of course, there are those who will say that we should cut the size of the CAP budget anyway and put it back into the central kitty. The UK Government’s central objective is to transfer that money to Pillar 2 for rural development programmes. We want to make sure that it is done in such a way that we do not suffer. The UK suffers in this, as those experts here will know, because of our rural development programmes in the past. There is a possibility there. Much of the £3 billion expenditure over seven years that we have announced—I cannot put a figure on the precise amount—is essentially for rural development. Therefore, it will touch on areas of outstanding natural beauty.

I always go back to page 44 of the Communities Plan, published in 2003 by John Prescott, which set out the land mass of England. Seven per cent of it is covered by the national parks, to which the noble Lord, Lord Bragg, referred. Thirteen per cent of it is green belt. Sixteen per cent of it comprises areas of outstanding natural beauty. All those plots of land are separate. The national parks are separate from the areas of outstanding natural beauty; they are both separate from the green belt. Added together, they cover 36 per cent of England. It is reckoned that urban England covers 12 per cent. That gives us about 48 per cent of England. It leaves 52 per cent for everything else. It is argued that there is not enough room for housing. As the noble Lord, Lord Bradshaw, said, as long as that housing is built carefully and sensitively, and the land managed properly, there is plenty of land still to protect the beauty of our environment. The green belt does not qualify as an area of outstanding natural beauty. A lot of it is rubbish land, as I have said before, because it is a collar around the urban area. It is not the most beautiful land, but it is there to stop the sprawl. Nevertheless, as I said, areas of outstanding natural beauty cover 16 per cent of England and are separate from the national parks. So there is quite an area there.

The Lake District would qualify in anyone’s definition as an area of outstanding natural beauty. I shall not go into the administrative differences, which I am sure the noble Lord, Lord Bragg, fully understands. I declare an interest as having had for more than 20 years a one-week timeshare in the Lake District. I use it every year and get up there as often as possible, even on Defra business—I shall be there during the Recess, visiting farms in Cumbria. I met the hunt trailers last year. I know that the noble Lord is one of their presidents. I had seen hunt-trailing last summer but did not know what it was. It was only when I met the hunt trailers just before Christmas to discuss the difficulties they were having because of the foot-and-mouth restrictions that I realised what I had been watching at one of the shows that I had gone to.

We are in the process of reforming the hill farm allowance. I fully accept that hill farmers, particularly sheep farmers, have been more damaged by foot and mouth than probably any other sector of farmers. I hope that when the hill farm allowance is remodified, most if not all the money can be kept in those areas. Hill farmers look after the landscape. The first people to complain if it goes to wilderness will be the 16 million visitors to the Lake District from the cities. They will say, “Well, we’ve lost it all. It’s all gone to scrub. Why’s that?”. The response will be: “Well, we’ve lost the farmers. We didn’t look after them. You didn’t use the sheep and we decided not to subsidise them any more. We forgot that, if we want to manage that landscape, it will cost a fortune if it is not done by farmers living there”. Therefore, that is an issue, and I fully take on board what the noble Lord said.

The noble Lord, Lord Plumb, said that he would not be present. We had a very pleasant day. It was a Friday, not a Saturday. I well remember it: it was about three years ago. I also went, as the noble Lord said, to the annual meeting of the conservation board just a year ago. We got the message there about there being no budget yet and the damage that it has caused. I agree that a board of 40 members seems quite preposterous. Fifteen are sent by the Secretary of State; 17 are sent by the local authorities; then there is a string of others. You cannot have effective management that way. That is where there is a problem. Each local authority wants its champion but there are difficulties in managing with such large boards.

The right reverend Prelate the Bishop of Portsmouth mentioned the Isle of Wight. I plead guilty to never having visited. I was talking earlier to two friends in Guildford who were going to visit the Hindhead Tunnel this afternoon, so it seems to be well under construction although I fully accept that it has been very slow. He also makes a valid point about resources and the way the money is dealt with, and he referred to the cuts in funding. There are choices but no decisions or announcements have been made. I realise there are rumours and that this debate is timely. Natural England’s board will get a copy of the debate, as will Defra officials. The overall budget has been set but the individual breakdown has not been made available or any final decisions made. The right reverend Prelate also raised issues relating to the proposed national park. I can only say that we anticipate that a decision about the park will be taken by January 2008, so there may be a light at the end of the tunnel.

I fully accept what the noble Earl, Lord Selborne, said. He made a case for making these areas vibrant because if they are not, they will die. They must not be put in aspic; there has to be a vibrancy of work and play. We have to be sensitive to planning matters but we do not want villages to simply die as businesses leave and new ones are not allowed in. So we need good, vibrant, sustainable areas in those parts of our countryside.

I cannot answer all the points made by the noble Lord, Lord Bridges. He certainly gave us a history lesson. I declare an interest only in the sense that I am a member of the RSPB—and the noble Lord is right: Defra does not want to go to war with the RSPB. For the first time in my life I walked the strip of land between the river and the sea at Orford Ness in the Easter Recess last year. I fully accept that people in London have no idea of these areas of outstanding natural beauty, of which the noble Lord gave examples. In a way, it is salutary that local authorities are making decisions about these designated areas and they do not appreciate that they are in them. You do not see a sign like you do when you go into the national parks because it is a matter for the local authority. Local authority signs are up on the roads but AONB signs do not appear in that way.

The noble Lord, Lord Marlesford, may have been personally complimentary but he was also quite nasty. He does not like my department or any of our agencies. It is not true that the Environment Agency has written off the whole of our coastline. That is somewhat of an exaggeration. I do not know all the details but there are proposals in that part of the world to give up some of the land back to the sea. I will seek to write to him and make sure that he receives up-to-date information on this. He asked a specific question about PPS 7 and Section 85 of the Countryside and Rights of Way Act. They will not be diminished by the Planning Bill; I can give him positive assurance on that. The Environment Agency works 100 or more years ahead. In terms of coastal defences and flood plains, they make estimates for a long term ahead. Part of the discussion about the Thames Barrier is predicated on looking a quite long term ahead. The noble Lord made the point about aircraft, as did others. If the aircraft stack up over the water, you could argue for putting the airport in the water. That is not an argument that the Government are putting forward. I do not think I can get into that.

I shall be on the A30 myself in about 48 hours, so I shall be part of the generation of the noise the noble Lord, Lord Bradshaw, referred to. I think he is right about the noise. In the old days when Dunlop was a proper company they produced a road surface which was better for braking and drainage and, above all, a lot quieter because it was for use on the urban motorways.

There is no difficulty in encouraging tourists. I am not going to say that this is a matter for another government department because, as the debate has shown, by definition virtually every government department is involved in what we are dealing with here. There is no difficulty with tourism. I am happy to make inquiries about that, but I have not been made aware that the areas of outstanding natural beauty are suffering particularly as a result of tourism.

The noble Lord made a point about the funding of the rural community councils. There is also the Rural Services Network, a 250-strong organisation that recently sent Defra a document. I apologise that it got buried under my files on the Climate Change Bill. Nevertheless, there is a case to be made. A lot of the small organisations are run by volunteers, as has been said, and can make a much better contribution than a plan from Whitehall can. They can also be better value for money. Great schemes of mega-billions do not always get down to where we need them.

Another issue that was raised, although I think it is accepted, is the difference between the national parks and the areas of outstanding natural beauty. We fund them differently. The national parks are virtually quasi local authorities. There is a big difference between them in that the national parks have planning powers, which is a substantial change to the way in which they are administered. There are some 40 areas of outstanding natural beauty. I do not know how many local authorities are involved in those 40 areas; I should have asked, but I did not. The noble Lord, Lord Plumb, told us that there are 17 areas of outstanding natural beauty in the Cotswolds, so the numbers are enormous. It may be that greater numbers of areas of outstanding natural beauty being in fairly small local authorities with smaller capacities does not give them a loud voice. That may be a difficulty; I do not know. A good many local authorities in this country will have an area of outstanding natural beauty, or part of it, in their area, and I do not know whether some local authorities give them more importance than others.

The noble Lord, Lord Bridges, asked about decision-making. I am reminded that back in 2005, the then Minister, Alun Michael, issued a note to departments to ensure that they took account of areas of outstanding natural beauty in their decisions. As it is 2008, and as I have been reminded that we are coming to the end of a period of this Government—those are not my words but another Peer’s; he is very optimistic—I will take the opportunity to see whether we can reissue Alun Michael’s salutary reminder to other departments to ensure that they take account of the areas of outstanding natural beauty in their decision-making.

I mentioned PPS 7. I cannot get into the question of the stacking of aircraft, which is a matter for the Civil Aviation Authority and the Department for Transport. I often wonder why we still fly to Paris and Brussels, but I have said that before. On the other hand, ruling out cheap flights is not an answer. It may be a slip of the noble Lord’s tongue, but having only expensive flights is not a message that any Government would want to give to their population. We must deal with the question much more sensitively than that.

I have probably covered a good deal of the issues without coming to the first paragraph of my speech. I will trawl those that I think I have not covered to ensure that I cover them all. I congratulate the noble Lord, Lord Renton, again on securing the debate and on the way in which he introduced the subject. It is always a pleasure to congratulate someone who has had a big influence on legislation. Today was a fitting tribute to that.

My Lords, I congratulate and thank all those who have spoken in this debate, including the Minister and others on the Front Bench. The speeches were unusually thoughtful, knowledgeable, passionate at times and, typically in the case of the Minister, very lively.

I am delighted that in the course of the last two hours we have strayed from Cumbria, through the Lake District, to the north Pennines, and on to the Chilterns and Cotswolds. We have touched briefly on Oxford, quite a lot on Suffolk, and we then moved down to the Kent Downs, Hampshire, Sussex and the Isle of Wight. We have all supported the idea that AONBs need more help. We have all expressed the wish that they should be able to fulfil their important objectives. I was particularly delighted to hear from the Minister that the Government strongly intend, in the EU financial negotiations, to move CAP money from Pillar 1 to Pillar 2. Reading this debate on the internet or in Hansard will give great pleasure to all those who work for the AONBs and all those who wish to protect our beautiful countryside. I beg leave to withdraw the Motion for Papers.

Motion for Papers, by leave, withdrawn.

rose to move, That this House takes note of the report of the Select Committee on Regulators on UK Economic Regulators.

The noble Lord said: My Lords, it is with great pleasure that I open my remarks by thanking those who have taken part in the work of the Select Committee on Regulators in the past Session. I thank the members of the committee, in particular those few who have found it possible to stay until this last moment before we depart for our Recess. I thank the clerk and the specialist adviser, Sarah Price and Boaz Nathanson, and the two specialist advisers, Graham Corbett and Eileen Marshall, who helped us so much.

I have been in this House for 25 years and have never had any contact with the committee system before. I am puzzled by it; it is a very strange way to gain wisdom. First, for a committee such as ours, which lasts only for one Session, the timing is very tight. You put out for evidence in December, get it back by February, talk and listen to people between February and June, produce a draft report by the end of July, and debate it in October. I am a researcher by trade and I would wish to spend a considerable time ascertaining basic facts before I started asking questions. Evidence-based, which these reports are, means evidence in the legal sense—in other words, what people said to us, rather than what is the truth. It is our ability to discover and ask the right questions, and question answers if they are not clear, which leads to the quality of the final report. Any defects in that quality are my personal responsibility and not those of the others who took part. It is a strange business.

In the time available to me, I am going to do two more things, other than question the committee procedure of this House. First, I am going to race through the recommendations of the committee. Secondly, I want to say some things about what has happened in the regulatory world since we drafted our report at the end of July and since we reported in October. What has been happening is quite dramatic. I have 11 points to make about the report and I will race through them.

On regulators’ statutory remits, we decided that they were pretty good, despite being arrived at almost at random in a series of privatisation Acts which were never thought out as a whole. There were never any consistent policy decisions about the establishment of the regulatory estate, but it seems, on the whole, to work. We recommended against new legislation, but said that there should be standardisation of remits as opportunities arise.

We looked at the working methods of regulators and the value for money they provide. It is certainly true that the cost of regulation has gone up, but we concluded that, generally, the cost has gone up because of the increased workload that has been put onto regulators, rather than through inefficiency. I take the particular example of the FSA being given mortgages and general insurance markets, which enormously increased the number of firms that it had to regulate.

We looked at the issue of risk-based regulation and principle-based regulation. In evidence to us, Ed Balls made it clear what had not been entirely clear to me: that you can have risk-based and principle-based regulation. You have to have it when you are dealing with large numbers of smaller firms—what you might call retail regulation—but it is much more difficult and not necessarily desirable for very large firms. I shall be saying more than a word about Northern Rock in due course. Some of the conclusions to which we came have been invalidated by subsequent events.

Thanks to the National Audit Office and Ed Humpherson in particular, we looked at regulatory impact assessments. The NAO concluded in a study that it did for us that regulators are pretty good at pre-impact assessments—better than the Government in fact—but not so good at post-evaluation. It is a bit like post-legislative scrutiny: it is a good thing but it has not actually happened. We concluded that regulators on the whole should be responsible for their own impact assessments although there were certainly exceptions, particularly for post hoc examination.

We looked at the issue of the citizen and the consumer—the public interest. We concluded that the definition of “public interest” or the obligations to citizens should be defined by the Government and Parliament and promoted by the regulators. Ofcom is a good example of that. But we certainly did not think that the interests of citizens should be ignored even though the phrase “public interest” is not much more than a Humpty Dumpty phrase. It means whatever you wish it to mean, but it should mean something. On consumer representation, we concluded that, generally, consumer representation should stand alone as separate from the regulators themselves.

We looked at the relationship between sector regulators and functional regulators—the OFT and the Competition Commission. We thought that concurrency arrangements were working quite well, but we still needed more referrals to the functional regulators and there should be more use of competition law.

We looked at relationships between regulators and the Government. Again, we thought that it was working pretty well, but we were taken aback that Ministers giving evidence to us did not seem to know much about what each other were doing although they were reasonably well informed about their own responsibilities.

Because we were concentrating on economic regulators and the economic effects of the regulation system as a whole, we looked at issues of competition and competitiveness. Not all regulators are competition regulators and, on the whole, although competitiveness should follow from greater competition, that does not always happen. We were unkind to Ofwat and the water industry for not achieving any effective competition.

We looked at whether sectoral regulators were going to fade away—whether there should be a sunset clause—as many people thought would happen when they were first established. We came to the conclusion that St Augustine of Hippo was right:

“Make me chaste Lord … but not yet”.

Yes, it is a desirable thing, but we are nowhere near that yet. There is a continuing role for the Government. Matthew Parris in the Times last Saturday made that very clear. He said:

“The market must be the engine of our economics and therefore our politics. That argument is over. But now another starts. What about the accelerator, the brakes, the gearing, the emissions control?”

If the committee had known that it would have agreed with it.

Finally, we looked at accountability and parliamentary oversight. Some of that happens, of course. We think that it is important for the OFT to report to the Joint Regulators Group and that it is important for Ministers to talk to each other perhaps more than they do. We are very appreciative of the work of the House of Commons departmental Select Committees. For example, the Treasury Select Committee report on Northern Rock in January was an outstanding piece of work. We felt very much frustrated by our limited timescale, the fact that we had to limit ourselves, therefore, to particular issues of regulators, not of regulation, to economic regulators and to cut out all sorts of important issues that this House should consider; for example, the social and environmental effects of regulation. Therefore, we recommended, in line with the recommendation of the Constitution Committee, chaired by the noble Lord, Lord Norton, in 2003-04, that ideally there should be a Joint Committee of both Houses or, if not, a continuing Select Committee of this House, which would have responsibility for the regulatory estate, because, as I have said, it is always with us.

What has happened since we drafted and considered our report? A huge amount has happened. I could give many examples, but I shall concentrate on the FSA and Northern Rock. Ofgem, for example, after giving very self-congratulatory evidence to us, allowed price increases in January this year of 12.7 per cent for electricity and 17.2 per cent for gas. As for competition, Ofgem has allowed the number of suppliers to decrease from 20 in 1998 to six today, with vertical integration that makes it very hard for anyone else to enter the market. There have been problems with the Civil Aviation Authority and the Office of Rail Regulation, with which I do not have time to deal, and with OFWAT, with which we did have time to deal.

I want to talk most of all about financial regulation, because there has been a huge change in the success and stability of financial markets. A lot of it was predictable. It was predictable while we were reporting, so we are at fault, or I am at fault. Alan Greenspan said in 2005:

“Increasingly complex financial arrangements have contributed to the development of a far more flexible, efficient, and hence resilient financial system than existed just a quarter-century ago”.

I do not think that anyone would say that now, although he wrote a typically equivocal article in the Financial Times a couple of weeks ago. The Minister, my noble friend Lady Vadera, will recall that he spoke at a meeting in the Treasury a few years ago when he made a particularly opaque speech which I came out of saying, “I don’t think I understood much of that, but I think that he was approving of derivatives and hedge funds. And I think he is wrong”. I still think that he is wrong.

We had plenty of warning, if we had known about it. The Government and society had plenty of warning. The Bank of England Financial Stability Report in April last year said:

“Macroeconomic stability is encouraging greater risk-taking … use of risk transfer markets is affecting the depth and quality of risk assessment”.

That means that those who are supposed to be assessing risk are,

“less inclined to assess credit quality … if they bear little of the ultimate risk”.

The report said that there is less information on borrowers and on monitoring. Has not all of that proved to be true in the past six months?

The FSA’s oral evidence to us in March last year—and the questioning, which again is my fault—was all about over-regulation. It was all about the accusation by the Royal Bank of Scotland that the UK regulatory regime was one of the more onerous. I do not think that we would say that today. The Treasury Select Committee, in its report in January, found no excuses for the way in which Northern Rock was regulated by the FSA. There were plenty of warning signals. The report said that the business model of Northern Rock was clearly stated, that there should have been a warning in the rapid expansion of Northern Rock, that the fall in the share price was a warning, and that the Basel II waiver, where they pay dividends and weaken the balance sheet, should also have been a warning. The report said that Northern Rock looked at solvency and not liquidity and pointed out that liquid assets for all of these businesses had gone down from 20 to 30 per cent 40 or 50 years ago to 1 per cent now. Mervyn King told the Treasury Committee last week that,

“financial institutions will have to hold more capital in the longer run”

and,

“their activities will have to be monitored much more closely”.

In other words, more regulation, not necessarily lighter regulation.

The FSA internal audit, published in February this year, was candid about what went wrong in the supervision of Northern Rock. There have been three reorganisations—three heads of department—in the past four years. In that time, there have been eight meetings, of which five were on the same day and none kept adequate formal records. The Treasury Committee questioned whether there was any meaning in “close and continuous supervision”. It questioned the lack of a risk mitigation programme. Since it made comparisons with only five other banks, there is still a lot of work to be done. The FSA audit said that Northern Rock was at,

“the extreme end of the spectrum of regulatory practices”.

What does that mean? Does it mean that other banks were being regulated more closely? I think not—but that is what it ought to mean. It ought also to mean that Northern Rock was inspected more closely. Mr Hector Sants, in his response last week to the internal audit report, said that the,

“overall regulatory philosophy as a risk-based outcome-focused regulation is supported and reinforced by this analysis”.

Is it indeed? It seems to me that Mr Sants is recommending much more regulation, increased links with the Bank of England and with international organisations, increased resources, an increase in the number of staff, and an increased priority for their work.

At the conclusion of this exercise, I am deeply dissatisfied, not with the work that we did, which was of considerable value in the limited time available to us and with the terms on which we were appointed. However, I do think that we and everyone else failed to anticipate the conclusion that society must now reach—that the regulatory state is with us for good. The Economist this week said that the experiences of Northern Rock,

“make calls for tougher regulation hard to resist”.

It added that,

“writing rules may do more harm than good if the regulator is unable to enforce them”.

The regulatory state is with us to stay and we shall need continued and better parliamentary oversight of it. We shall have to find a way of achieving that. I beg to move.

Moved, That this House takes note of the report of the Select Committee on Regulators on UK Economic Regulators (First Report, Session 2006-07, HL Paper 189).—(Lord McIntosh of Haringey.)

My Lords, it is a great pleasure to follow the noble Lord, Lord McIntosh. I begin by congratulating him on his extremely good and efficient chairmanship of our committee in what was a daunting task. He did it superbly. I also thank our clerk and our special advisers for all their assistance.

I entirely agree with the noble Lord that the regulatory state is here to stay and that there is a constant need for parliamentary supervision. I will come to something of an opposite conclusion on Northern Rock, but I agree with his general concluding point. I said that the chairman had a difficult task because we were confronted with a difficult problem. We had only one session and it was a huge task to look at overall regulation, which no one else had undertaken in the same way. It was right that we concentrated on the economic regulators.

We looked at regulation in the round and had a massive response in the evidence that we took and assimilated, although inevitably we had to skim the surface in some areas. We tried to draw out the broad principles in the key areas, and I hope and believe that we did so successfully. I think that the noble Lord, Lord McIntosh, was unfair to himself in the criticisms that he made, and I shall come to that later.

Certainly, I believe that our report, including the evidence, will be a big quarry for policy makers, regulators and academics for some time to come. The Government’s response—including, in part, in the Regulatory Enforcement and Sanctions Bill—showed that in many areas they were in agreement, and I was pleased to see that they supported many of our recommendations.

I say in parentheses—this point was referred to by the noble Lord, Lord McIntosh—that one recommendation that the Government rejected was the one in paragraph 6.60, suggesting that,

“an inter-ministerial forum be established to require ministers to compare views and share best practice”.

We came to that conclusion because we had three Ministers in front of us who were all responsible for regulation in their departments and they confessed that the first time they had met to discuss regulation and regulatory principles was when they were aware that they had to give evidence to our committee. The Government outlined in some detail the ways in which they believed that they required Ministers to compare views and share best practice, but I wonder whether that always works out in the way that was indicated. Some of us have past experience, as Ministers, of huge workloads, and sometimes we can focus attention on issues only when they arise, as was the case when the Ministers had to appear in front of the Select Committee. I suspect that it is more a thought in principle than in practice that Ministers regularly share best practice. I ask the Minister to comment on that but I still think that our recommendation stands.

In the time available, I can pick out only a few of our recommendations. I start with the one that a Select Committee should continue to be established. The Government rightly said that this was for Parliament to decide, but I think that that recommendation stands because no other departmental or Select Committee undertook the work that we did, and it was worth while. Apart from the general overviews, which will occur from time to time because, however much we seek in principle to see the regulatory estate diminished, in practice it will always be substantial and, in a complex world, possibly grow, I have identified three areas where I believe ongoing scrutiny would be valuable.

The first is in operating costs and value for money—I refer noble Lords to our recommendation in paragraph 4.17. We had a National Audit Office study, which was extremely useful, and, in particular, we took evidence from the OFT and the Competition Commission about their methodology, which struck us as being at the forefront of the best ways of doing value-for-money work. Of course, we were extremely interested in keeping operating costs down.

In a letter to all members of the committee, Ofgem drew attention to the fact that its operating costs have recently come down in real terms because it had taken the same approach to its operating costs as it had to its regulated industry’s pricing. I acknowledge that sometimes the costs will have to be higher. The noble Lord, Lord McIntosh, gave an example relating to the FSA. In the light of Northern Rock, it is certainly the case that the FSA will have to employ more highly qualified, and therefore much more highly paid, people in that area. I agree with the point made by the noble Lord, Lord Borrie, the other day in Question Time that seconding high-level staff is one way of doing it, but that could of course increase the costs. Nevertheless, it is important that value for money and operating costs are constantly scrutinised and I believe that a Select Committee would do that across the board.

The second area is impact assessments. I refer both to pre-policy work, with regard to which we made recommendations about the presentation of impact assessments and clear targets to enable post-impact work to be done more effectively, and to post-impact assessments. Here, we made perhaps the most detailed recommendations of the whole report. I recognise how much work the Government and regulators are doing in this context. However, there is a danger that this will become an area for regulatory wonks, if I may put it that way, and that insufficient parliamentary attention will be given to it, except where there is a critical contemporary issue, such as Northern Rock. Because of the pressure of work elsewhere, Members of Parliament and Members in this place do not always give sufficient attention to this matter, and therefore the importance of regulatory impact assessments gets downgraded. I believe that a Select Committee charged with reviewing progress on this front would help considerably to overcome that danger.

The third area relates to our recommendations in paragraphs 7.32, 7.45 and 7.46 on self-regulation and withdrawing from sectoral regulation wherever appropriate. I agree that the scope for complete or even substantial removal may be limited, but I believe that this nevertheless continues to be an important area for scrutiny from outside—from Parliament in particular. I cannot see anyone else doing it, other than a Select Committee created specifically for that purpose. That is a strong reason for a committee of this sort to continue.

In paragraph 5.50 we made a recommendation about the public interest and the citizen interest. We received a lot of evidence pressuring us to involve the regulators in those areas, over and above their main rule of promoting competition, and in the social and environmental policy areas, which we were told should be devolved to the economic regulators. However, I believe that those areas are for Parliament and the Government to decide and should not be devolved to regulators. Therefore, I stress the importance of our recommendation that,

“the interests of citizens and the general public are for Government and Parliament, and not for the regulators, to define or promote”.

As I say, we had quite a lot of evidence pressuring us to go into that field.

Finally—perhaps this is my main message this afternoon—there is the importance that we attached to principle-based and risk-based regulation. Those are not quite the same things. Principle-based regulation has to be balanced against the danger of sometimes reducing the clarity and certainty of rules for the regulated. That point was made to us by a number of witnesses. Nevertheless, I feel that principle-based regulation has a lot of merit. In this section of our report, we commended the FSA for its approach to principle-based and risk-based regulation. We quoted the National Audit Office, which also commended the FSA in this area. The then chief executive of the FSA, John Tiner—I warn the noble Lord, Lord McIntosh, that I am going to reach a different conclusion from his—told us in oral evidence that,

“there are two guiding principles about how we do our work. One is what we call ‘risk-based regulation’. That means in the financial services markets there will be failures and there should be failures—that is the essence of a marketplace, and that is the essence of risk transfer, which, after all, is what financial services is all about … Secondly, we believe very strongly that high level principles create a better way of delivering those statutory objectives in a marketplace which is competitive, vibrant and innovative, than lots of lots of very detailed rules”.

Of course, that hearing and the drawing-up of our report came before the Northern Rock debacle, which I do not blame the noble Lord, Lord McIntosh, for not anticipating. There will always be more pressure for greater regulation after such a crisis. In such circumstances, the media, many Members of this House—and certainly Members of the other place—and the public will often press for greater regulation. That includes those who, in other circumstances, seek less regulation, as many did in evidence to our committee. The noble Lord is quite right that much of the evidence that we took about the FSA was in the direction of less detailed regulation and control, rather than the other way round. However, when a Northern Rock crisis emerges, some of those people change their tune and call for more regulation.

It is not appropriate in this debate to discuss some of the other aspects of Northern Rock, such as whether the tripartite system of institutions worked—that is for another day—or Basel 2 and that whole area, in which there needs to be greater emphasis on liquidity, not just solvency and the capital base of the financial institutions. I think that that was the point that Mervyn King was referring to in the quotation used by the noble Lord. However, the position of the FSA is relevant to this debate. I very much agree with Richard Lambert, director-general of the CBI, who, in a recent and, I thought, brilliant speech on what has happened since the credit crunch, said, “Don’t rush things”. In particular, he said:

“There are limits to what regulation can achieve, and attempts to regulate complexity can actually make things worse”.

He of course referred to the Sarbanes-Oxley situation post-Enron, which greatly damaged New York and greatly enhanced the position of London in the world financial markets.

There are three reasons why Richard Lambert was right to say that. First, let us bear in mind that it was not only the FSA that did not see the rocks ahead, if I can put it that way; investment analysts and investment managers were supporting and advocating investment in Northern Rock when it was at £12 a share. They were supported in particular in their analysis by the credit rating agencies. I want to quote what Richard Lambert said in his speech; this area merits every bit as much attention as do the regulators. He said:

“The credit rating agencies have been dubbed the alchemists of the financial world, turning base metal into gold by their ability to attach high-grade ratings to repackaged junk”.

There is a salutary lesson there. He continued:

“EU Commissioner Charlie McCreevy put it this way the other day: ‘Credit rating agencies must ensure better management of conflicts of interests, a more transparent rating process, stronger rating methodologies and enhanced governance and accountability’”.

I particularly agree with that, especially the comment about the need for a more transparent rating process and stronger rating methodologies. The credit agencies, on which so many financial institutions depend for banking decisions and investment, are at least equally at fault—much more so in my view.

Secondly, the primary responsibility lies with the boards and senior executives. It is striking that many shareholders have suffered—it is perhaps the shareholders who do—the impact of what happened recently. I believe that the wealth of shareholders in the five leading UK banks has shrunk by £60 billion in the past year, and we have seen what happened to Northern Rock shareholders. I think—I believe that I share the view of many—that it is pretty intolerable that the chief executive of Northern Rock should have such compensation as he leaves, having guided Northern Rock through this period, when so many others are suffering. That is not a matter for government, but it is certainly a matter for corporate governance by the financial sector and institutions generally.

My third point is perhaps my most significant in relation to the FSA. If you read the FSA’s own highly critical report of itself—I spent a happy flight back from Spain over the weekend doing so—it is clear that the problem was caused not by a risk-based principle but because the process was not in this case properly applied. It was starkly and clearly not properly applied in a number of ways; the noble Lord, Lord McIntosh, referred to some of them. Northern Rock, for the FSA, was a high-impact firm. That means that it should have had very strong attention from within the FSA. It was one of the most potentially risky firms and required the greatest supervision but it simply did not get it. There were many examples—high turnover of top-line staff and a lack of supervision of middling staff, some of whom have left. One of the tables in the FSA report demonstrates that, of all the high-impact firms, Northern Rock got the least attention—quite disgracefully so in some instances. There was very poor supervision, which was why it was described as being at the extreme end of the spectrum of high-impact firms. I believe that our support of risk-based and principles-based regulation still stands. If anything, the Northern Rock experience does not undermine it but underlines it.

My Lords, as the first speaker in this debate this afternoon who is not a member of the committee, I congratulate the committee and its chairman on the excellence and thoroughness of the report and on all the work that went into it. The Select Committee has given the economic regulators quite a favourable end-of-term report. As the chairman said this afternoon, it would have been somewhat different—somewhat more qualified—as to the Financial Services Authority if it had been published somewhat later. An editorial in the Financial Times on 27 March following the FSA’s self-flagellatory criticisms of the previous day said that we will never know whether an alert Financial Services Authority could have prevented the Northern Rock fiasco but the questions raised are about regulatory practice more than regulatory principle—what the noble Lord, Lord MacGregor, referred to as regulatory process.

Your Lordships may believe that this is a criticism of the Select Committee’s report but its favourable comments about regulators cover both principle and practice. Most regulators were said by the report to be interpreting their remit both appropriately and effectively; they gave value for money and have developed some sound consultation procedures. There were some elements of criticism about lack of co-operation between Ministers and one regulator and another, but, in the light of later events—I speak with the benefit of hindsight—the substance of the Select Committee report seems a bit sanguine if this substantial document is to go down as a major work for academics and others to rely on as to the state of regulators, their principles and practice in the year 2008.

Chapter 3 is critical of what appear to be major variations in the statutory remits of the various regulators. It says that the Office of Fair Trading does not have a statutory duty to facilitate the development of self-regulation. It is true: we cannot find such a word in the Fair Trading Act 1973 or the other provisions, but I know from experience that the Act, which set up the Office of Fair Trading, requires it to pursue and foster self-regulation among trade associations. Some of the earlier ones are to do with strong consumer interests such as travel and the second-hand car trade.

Although only Ofcom and Ofgem have a specific statutory duty to implement the principles of good regulatory practice, so what? Those principles were only stated and articulated in 1997 and the 10 regulators to which the Government referred as the ones examined in detail by the Select Committee now feel obliged to follow those principles. It may be that in due course Parliament will get around to tidying up and filling in statutory gaps but I am not sure that it matters a hoot that practice follows the requirements and it does not appear in specific words in a statute.

As the noble Lord, Lord MacGregor, indicated, it seems a little ironic in the light of later events that the Select Committee holds up the Financial Services Authority as a model in terms of risk-based regulation and principles-based regulation. It seems to me that recent events in no way reduce the value of those concepts for regulators generally, yet I agree with what Ed Balls said to the Select Committee: clarity and certainty are to some extent in tension, one with another, and particularly in terms of tensions with a principle-based approach. The committee is right to spell out that not only consumers but also the smaller regulated businesses in particular may lose out from the lack of certainty and predictability that follows from the absence of prescriptive rules. People do not like prescriptive rules when asked in the abstract whether they like them, but there is a risk of firms exploiting less intrusive and detailed regulation. As the consumer organisation Which? argues, the FSA needs to review the incentives it has in place for compliance and, in particular, to reconsider its traditional opposition to naming and shaming firms that have gone against it. I think that the FSA could learn something from the competition authorities about being prepared to reward whistleblowers who reveal wrongdoing within the firm of which they have knowledge.

All the regulators have a clear statutory remit to further and protect the interests of consumers. Regulated companies invariably have internal complaints procedures. There are also various ombudsmen and other redress procedures available. I understand that the financial ombudsman scheme came in for a lot of criticism from business before the Select Committee, but the Council on Tribunals was complimentary, so different views were received by the Select Committee. However, the Select Committee was evidently not convinced because it has called for a review by the National Audit Office. As far as I can see from the Government’s response, they have not accepted that, mainly for the legal reason that there is an absence of power to do so in the Financial Services and Markets Act. Fortunately an independent review is being conducted by the noble Lord, Lord Hunt of Wirral, to which the Select Committee and the Government referred, and I hope that a lot of attention is paid to whatever it says.

There are various models for sector-specific consumer panels, and the Select Committee follows the consumer organisation Which? in its preference for stand-alone consumer panels as being more transparent and effective. At present, the Financial Services Consumer Panel is integrated with the FSA, and is not a stand-alone body, and Which?, which I am happy to follow in this, argued convincingly that even if the panel became a stand-alone body, there is still a need for adequate consumer or, at any rate, non-business representation on the FSA. I do not think that even a separate consumer panel should be any sort of argument for excluding anybody with experience of the consumer world from being a member of the authority itself. They have different functions. A consumer panel is a body of people to which requests can be made for information on what the regulator is going to do, but it is not a decision-making body, and it is desirable for consumers and other non-business people to be part of the decision-making body as well. They are not alternatives.

In recruiting its staff, the FSA must dip into the same resource pool as the regulated companies, but it has less money to play around with. The noble Lord, Lord MacGregor, kindly quoted a remark I made at Question Time the other day about how the FSA could perhaps learn from the model of the self-regulatory City Takeover Panel, which for the past 40 years has recruited by secondment from the firms it regulates.

I have perhaps said more about the Financial Services Authority than is necessary or desirable, but my noble friend the chairman of the committee—naturally, given recent events—did so as well. I hope that there is some agreement around the House today that we need a stronger, more robust Financial Services Authority, with wide-ranging board membership and a dedicated and adequately remunerated staff.

My Lords, I declare an interest as a member of the Select Committee on Regulators, and I pay tribute to the excellent chairmanship of the noble Lord, Lord McIntosh of Haringey. He provided a cogent overview of our recommendations and, since our report was published, there have been important developments, as he clearly delineated. Those developments reinforce the case that I shall develop.

Rather than repeat what the noble Lord, Lord McIntosh, said, I shall concentrate on one aspect of the report, reinforcing what my noble friend Lord MacGregor said. I shall focus not on specific regulators but rather on regulators as a species, and address one question posed in the report: who regulates the regulators? Not who regulates a particular regulator, but who regulates the regulators?

I begin with a statement of fact and a number of propositions, which I think are generally acceptable. The statement of fact is that, over recent decades, there has been a substantial increase in the number of regulatory bodies established by statue, and in the volume of regulation. As the Constitution Committee noted in its 2004 report on the regulatory state, the regulatory state is now extensive, with significant costs attached to complying with regulation.

I have four propositions. First, the need for some regulation is apparent, especially to encourage competition and to protect consumers. Secondly, where established by statute, the powers and responsibilities of the regulator need to be clearly prescribed. Thirdly, where there is scope for competition, the extent of regulation should diminish as competition is achieved and, in the fullness of time, the regulatory body should cease to exist. Fourthly, the activities of the regulators should be characterised by transparency, efficiency and accountability. It is the last of those that I shall address.

In the report, we have made recommendations designed to improve the transparency and efficiency of regulators, not least through the introduction of impact assessments and post-implementation review. The value of such assessments and review is clear. Indeed, the principle of post-implementation review is crucial, applicable to all public policy-making bodies, be they government departments in respect of primary and secondary legislation or regulators making regulatory decisions. The case for such review has been made by the Constitution Committee, the Merits of Statutory Instruments Committee and the Regulators Committee. I am pleased that the principle is accepted by the Government and is being pursued, including in respect of post-legislative scrutiny.

As we made clear in the report, advances are being made in respect of regulators, but there is still a considerable way to go in ensuring systematic assessment and review. That is clear from the study undertaken for the committee by the National Audit Office. I draw attention in particular to Table 14 on page 113.

However, it is the issue of accountability that I wish to pursue. As the noble Lord, Lord McIntosh, mentioned, in 2004, the Constitution Committee produced its report entitled The Regulatory State: Ensuring its Accountability. As he mentioned, I chaired the committee. In its response, the Government welcomed the report as,

“the first-ever comprehensive inquiry”

of its sort. That may seem surprising, given that regulators are subject to extensive scrutiny by parliamentary committees, as well as by other bodies. Indeed, in the report, we identified what we referred to as 360 degrees of accountability.

Each regulatory body established by statute is bound by the statute creating it—the Lord, Lord Borrie, touched on that. Each is accountable to government, consumers, the regulated bodies, the courts and to Parliament, but it is the accountability of the individual regulator. In terms of parliamentary accountability, each regulatory body is covered by a departmental Select Committee in the other place. Most are subject to scrutiny by the National Audit Office. However, there is no mechanism in place for scrutiny of the regulators collectively, of what the Constitution Committee termed the “regulatory state”. There is what I would call “vertical scrutiny”—that is, scrutiny within a sector—but very limited “horizontal scrutiny”; that is, across all regulatory bodies. The more the number of regulatory bodies has increased, each created by a statute tailored to that particular regulatory regime, the greater the need to stand back and ensure that regulators collectively are accountable to Parliament.

The need to ensure consistent and comprehensive scrutiny of the regulatory state is clear from the report of the Constitution Committee as well as from the report before us today. Particular regulators may be subject to scrutiny by their respective departmental Select Committees—but how do we know what is happening with regulation as regulation? How do we know what the overall burden of regulation is? Is it increasing or decreasing? How do we know what is best practice? Is one regulatory regime proving more effective and efficient than another in encouraging competition and protecting the needs of the consumer? We can answer those questions only through comparative scrutiny.

What capacity does Parliament have to engage in such scrutiny? The NAO, which reports to the Public Accounts Committee in the other place, can examine most, but not all, economic regulators. The Constitution Committee of this House can look at the regulatory state—that is within its remit—but it has other responsibilities. The Regulators Committee, as we make clear in the report, necessarily had to limit the scope of the inquiry to regulators, not regulation, and to focus on the economic regulatory work of the major UK economic regulators. Even that narrow focus still required extensive work over the course of the Session. Our report is therefore a prompt to take the necessary action to ensure accountability, rather than delivering such accountability.

As the Constitution Committee argued in 2004, improved parliamentary scrutiny rests on capacity, consistency and co-ordination. A departmental Select Committee does not have the capacity for sustained and consistent scrutiny. Its terms of reference do not permit co-ordinated scrutiny of the regulatory state. Anyone who doubts the need for looking at regulators in a consistent and co-ordinated way should look at Table 2 on page 25 of the report. One can see from that the sheer variety of statutory duties imposed on regulators; it is a patchwork quilt of duties. It may be that each set of duties is appropriate, but there may be a case for more consistency. How do we know without thorough inquiry?

The need for greater parliamentary scrutiny was made by various witnesses who gave evidence to the Constitution Committee and was reiterated in evidence to the Regulators Committee. We have agreed with those witnesses who have stressed the need for such scrutiny. How, then, to deliver such accountability? The Constitution Committee recommended a Joint Committee of both Houses. It felt that such a committee would supplement, not supplant, the committees that had oversight of individual regulators and that it should focus its work around the annual reports and published impact assessments of the regulators. When the other place appeared unreceptive to the proposal, your Lordships’ House agreed to set up an ad hoc committee. The Regulators Committee was given a broad remit, to “examine the regulatory process”, but, for the reasons already explained by the noble Lord, Lord McIntosh, we looked at the major economic regulators. In other words, we have not had the opportunity to examine the whole regulatory process. Furthermore, as we say at paragraph 6.63,

“we are the child of the Constitution Committee’s report, but not the wished child. Our existence is terminated with the publication of this Report and the subsequent debate on it to be held on the floor of the House”.

It is vital that examination of the regulatory state, of the health of the process of regulation, does not come to an end with this very debate. As we stress in paragraph 6.65, there is a need for a wider, and continuing, review. We also state:

“We agree with the conclusion of many of our witnesses that ‘there is a crucial need for greater parliamentary oversight ... over regulation bodies’ ... The question of who regulates the regulators has not been answered and will not go away. There is a need for a committee to pursue cross-sector best practice and to ensure that the recommendations of this Report are followed-through”.

We therefore recommended that the creation of a Joint Committee of both Houses be established. If that proves impossible to achieve, then we recommend a sessional committee of your Lordships’ House.

The volume of regulation in this country is substantial, it imposes substantial costs and it has implications for the health of our economy. Yet we have no means of ensuring that such regulation is monitored, assessed and, if necessary, modified by Parliament in order to meet the needs of the consumer and of competitiveness.

A parliamentary committee is a means of ensuring such accountability. It is to the benefit of not only Parliament but Government. Government establish regulatory bodies for constitutional, political and economic reasons. It is to Government’s benefit to ensure that regulation is effective, efficient and utilised only where necessary.

The Minister may feel that she has got off lightly in that she need only respond—as she did in the written response to the report—that this is essentially a matter for the House and House authorities. However, Government are not totally detached from the parliamentary process. As I have indicated, it is to the benefit of Government to see such a committee established. The Minister’s response to the report acknowledges in effect the value of comparative scrutiny. How are we to ensure that what the Minister acknowledges is desirable, as for instance on post-implementation evaluation, is delivered? Recent events have reinforced the case. Although my comments are addressed as much, if not more so, to the House authorities as they are to the Minister, it will, however, be helpful to have the Minister’s endorsement of the recommendation.

The impact of regulation needs to be assessed and monitored on a consistent and comprehensive basis. We presently lack the means for doing that at a parliamentary level. We need to create the means. There are resource implications, but the importance of the subject is such that it would be a false economy for this House not to act on the committee’s recommendation.

My Lords, I am pleased to be taking part in this debate. I congratulate the committee and my noble friend Lord McIntosh of Haringey on chairing it. It is a most excellent report. I gave evidence to the committee as chairman of the Rail Freight Group and I declare an interest in that regard. Having read the report and listened to the excellent contributions so far, there is a strong case for ongoing scrutiny of the whole regulatory structure.

A common theme in the report is the burden on the regulated industries. There has clearly been a lot of lobbying from these industries which, I believe, resulted in the Regulatory Enforcement and Sanctions Bill that many of us participated in. I am grateful to my noble friend the Minister for the changes that she agreed to make to the last part of the Bill in trying to deal with some of the concerns of the economic regulators.

However, we hear far less about the effect on the regulated industries and the need for the regulators to be really independent; to have lots of information to do their jobs properly; and to get the support from customers, users, Parliament and others to feel confident that they can act without fear of government intervention or judicial review.

One of the jobs of regulators is often to promote competition and to get costs down, particularly if they are regulating a monopoly such as Network Rail or Royal Mail. Nobody, in my experience, has come up with an alternative way of doing it. We hear a lot of complaints from the regulated industries. The Royal Mail is the latest one, warning of the dire consequences if it is not allowed to do anything and that it might go bust. Railtrack did go bust and the railways are still running. The regulators have to have solutions up their sleeve.

When trying to find a regulatory balance, we must recognise that, where regulation is necessary, in particular when there is a need to support or develop competition or regulate the costs of monopolies, regulators need the maximum encouragement to go further and faster in their work; otherwise, one will get regulatory capture. We have talked about that many times previously—I do not want to go into it in too much detail tonight—but big companies which are regulated can spend unlimited resources on putting out information which will either make the regulator’s job impossible or help to mitigate the effects. One has only to listen to the debate on the third runway at Heathrow and the information that is put out, sometimes against the CAA and others, to see that we must be very careful about that.

There is the question of the last mile for Postcomm getting letters delivered or opening up Post Offices to allow them to accept parcels, letters and other trade from companies other than Royal Mail. I was astonished to read in paragraph 7.22 of the report about Ofwat being unable to encourage competition. The report is not very clear about whose fault it is—Ofwat’s, the Government’s or somebody else’s—but it is quite extraordinary that, in a network industry, of which plenty of others are mentioned in this report, you apparently cannot have competition. Competition will in almost any way allow bench-marking and possibly some good cost reductions, too.

I cannot let this opportunity go without spending a few minutes on railways. The Office of Rail Regulation is mentioned quite a lot in the report. I and other people believe that it has good processes, and consults well and widely. It needs to be a little more proactive on occasions, but it is after all keeping on programme to get Network Rail’s costs down; by 31 per cent in five years and we hope much the same in the next five years, although that is not decided. Costs down means charges down; it does not apply just to railways either. It also improves efficiencies. The little detail with which we are troubled at the moment is keeping the network open for the customers, the train operators, to run the trains rather than closing it for maintenance. In that regard, they have a long way to go.

I hope that the Office of Rail Regulation will in the future look at corporate structure and accountability. The noble Lord, Lord Norton, talked about accountability of regulators. In the case of Network Rail, there is a problem of accountability of the company itself, which is a peculiar hybrid. I do not think that anybody wishes to change it, but it has to be reviewed. Network Rail is similar to Royal Mail, not in the company structure, or who owns it or its accountability, but in the fact that it gets much of its money from the state, which certainly affects the way in which the regulators have to deal with problems when they arise.

It was good to read in paragraph 6.56 of the report that the Minister for Transport, Tom Harris MP, put in a plea for,

“a long-standing period of settling down into the current regulatory framework”.

He is absolutely right. My noble friend Lord Jones of Birmingham, talking about regulation of the railways in a debate in which several of us participated on 14 March, said:

“Governance will depend on stronger and more independent national regulatory authorities. Noble Lords have this Government’s assurance that we will continue to push and press on that. I shall refer the specific transport points raised by noble Lords to the Secretary of State for Transport and I assure them that they will be taken up”.—[Official Report, 14/3/08; col. 1705.]

Ten days later, they still have not been taken up. In a debate on the Channel Tunnel Rail Link on Monday evening, my noble friend Lord Bassam of Brighton said that the Government wanted to ignore the regulatory policy of this Government and keep the Department for Transport as a regulator of the Channel Tunnel Rail Link because,

“the current structure will secure a higher sale price by enhancing the commercial stability of High Speed 1”.—[Official Report, 31/3/08; col. 784.]

There is nothing about any other regulatory rule, nothing about getting more traffic on the line. It is just for the short-term taxpayer’s gain. The department will set the charges to suit its own ends rather than relating them to the costs of operations and maintenance and it is very unlikely to do what the Office of Rail Regulation is doing and impose an efficiency requirement on the baby that it has just sold off.

The noble Lord, Lord Bradshaw, and I both met potential buyers for this line who said that, as investment companies, they would much prefer the certainty of independent regulation than the uncertainty of departmental regulation. Not only that, but they would pay a higher price for that certainty. I do not know whether my noble friend Lord Bassam did not believe us but he seems to be batting on with this policy, which is totally contrary to the BERR policy and will do nothing to provide the comfort and stability of investors that the Government clearly intend.

I suggest to my noble friend—who I hope is going to respond on this—that she advise her noble friend in the Department for Transport what government policy on independent regulation is. Perhaps it is time, as the report says in paragraph 6.60, to have this inter-ministerial forum, as the noble Lord, Lord MacGregor, suggested. My honourable friend the Minister for Transport Tom Harris suggested in his evidence that a long period of stability is needed to settle into the current regulatory framework. We have not had it that long—only three or four years—and already the Government are trying to change the rules. I hope my noble friend can persuade her noble friend and my noble friend to look at the Channel Tunnel Rail Link again and possibly comply with the regulatory policy that she and her colleagues are putting out.

I conclude by congratulating my noble friend on this excellent report, emphasising again that there is much more to do on regulation in the medium and long term and that we need some process for scrutiny here and in the other place.

My Lords, it is just as well to remind ourselves of the history of the development of regulation. It was a result of the privatisation of the industries. Most of the industries were transferred from the public sector to the private sector, almost debt-free. The companies who bought them borrowed huge sums of money, geared up their balance sheets, gave the money away to shareholders and then came back to the Government and said, “You want us to do all this; give us some more money or let us put the price up”. In the case of water, for example, people’s supplies were being taxed in order to pay these big companies. In my view, it is quite staggeringly bad economics. I have never supported the privatisation and I still think it was wrong. A company like Railtrack went bust because a) it was incompetent and b) it had paid out too much money—not very different in some ways from Northern Rock. But you need to have in place regulators who are thoroughly professional and able to take information, both from here and abroad—benchmarking information to which the noble Lord, Lord Berkeley, referred. That is very important and it becomes more important as the number of companies supplying power has dropped from 20 to six. The more concentration you get, the more important it is to get benchmarking from overseas. The regulators are gaining experience and are more professional, and some companies such as Network Rail do not like it very much when they are told that the services that they are giving are being given elsewhere more cheaply and efficiently and with less impact on the customer.

Obviously there is a need for the Government to keep abreast of what is going on, but the quoted paragraph 6.56 shows that they are not. I endorse the comments made here that there is a definite need for a specialist or sessional Select Committee. I do not have the confidence that has been expressed here about the National Audit Office. We were until recently almost inundated with great thick reports from it full of pictures and not much substance. The NAO is not highly professional. Members of this House probably bring more focus to the issue than a National Audit Office person who moves from job to job looking at the health service one day, education the next and transport two or three weeks later.

Politicians should not hide behind regulators. It is the regulators’ job to evaluate business plans and to determine how much it should cost to fulfil them. If there is any public money involved, it is for the Government to decide what they want to buy and how much should be picked up by the customer. That is an explicitly political decision, and I do not applaud the idea of the Government somehow blaming regulators when many of the things go wrong.

The noble Lord, Lord MacGregor, referred to the comment by the Railways Minister that Ministers are so busy that they simply have no time to get around to this. If Ministers are that busy, they are not doing their job properly, which means that they must delegate away from themselves the trivia that many of them deal with so that they can get their minds around the principles as they are paid to do. It came to our notice last week through the trade press that the Department for Transport has now decided that any variation in the Great Western Trains franchise is a red box item. Quite honestly, if Ministers have the time to deal with the variations in the Great Western timetables but not with serious regulatory issues, I am sorry but they have got their priorities wrong and need to be put right about them.

Promotion of competition is important, but it will come as no surprise to Members of this House that the train company of the person who is lauded by the general public as being at the forefront of competition—I will give noble Lords a few guesses, but Richard Branson might be one of them—is invoking the agreement, which was made a long time ago when the west coast main line was opened, to moderate competition between the Midlands and London, which in fact means shutting out the new train operator operating from Wrexham and Shrewsbury to London so that it cannot call at Wolverhampton or Birmingham. What a competitive attitude to take. Even worse, the company has now announced that it is running a service from Wrexham. Lo and behold, Mr Branson is now running a faster train from Wrexham via Chester. He is, I think, receiving £250 million a year in compensation from the taxpayer to undermine someone else who is providing a service to the people of the Borders which people in Wrexham, Shrewsbury and Telford do not have. It is important that we promote real competition and challenge the people who would prevent it.

The noble Lord, Lord Berkeley, has mentioned the need for independence of regulation. It is most important that there is a clear dividing line between what the regulator is supposed to do and what people can expect from the regulator, and what Ministers are supposed to do and what people can expect of them. When a quinquennial—meaning every five years—review, is made by a regulator, it has to be done in that time, whereas with Ministers, I am afraid that often the decision will be made in the summer, at the end of the year, early next year, or later on. It really does drag on and on. I have Answers at home with all that sort of information from Questions I have asked.

The Competition Commission is cumbersome and expensive. It is expensive to go to and very slow to answer. I urge people not to send more things there than are really necessary. I believe that our regulators are doing a good job. This is a good report and it is right that Parliament should focus on it. I look forward to what the Minister has to say.

My Lords, I thank the noble Lord, Lord McIntosh of Haringey, for bringing to this House, if reluctantly, the report of the ad hoc Select Committee on Regulators entitled UK Economic Regulators. He obviously did not enjoy it; he was obviously embarrassed by doing it. The noble Lord is the first to say that the evidence was taken as far back as June last year; that, by the time the committee had produced its work, all hell had broken loose; and that what it had written was rather dull and dreary. I think he is wrong. The noble Lord will look back on this episode in his life as worth while and far-reaching. He said that it is the first time he has had anything to do with a Select Committee. I have been on several Select Committees and, over time, you begin to realise just how much can be done. I served on the Science and Technology Select Committee. I remember the small piece of work we did on aircraft travel, health and deep vein thrombosis. We have revisited that work, and it is quite amazing now what the airlines are doing about it. It cost the country very little because it was done by a little Select Committee of this place. I do not want the noble Lord to give up hope on this or to think that this is the last time he is ever going to do it.

The main conclusions of the report, which we can take away, and that the Government have thought on—and will, I hope, think on even more—may seem to the noble Lord, Lord McIntosh, to be rather broad-brush. Under the statutory remit of the regulators, the committee has recommended further standardisation of the remits and made all sorts of good recommendations about working methods, value for money, regulators committing to evaluating the impact of their work, regulators’ use of impact assessments and—very importantly—the relationship between the regulators and the regulated. This is a particularly good recommendation. The report concludes that industry needs reassurance that the time it invests in consultation is time well spent and is meaningful in the decision-making process. A 12-week consultation period to allow industry a reasonable amount of time to respond is recommended, because these are very big issues to work with. It is an excellent suggestion by the committee to build the confidence of the industry in a body that it often sees as a hindrance, rather than a help, to the good order of the industry, to its customers and its consumers.

On the protection of consumer, citizen and public interest, the committee recommends that the interests of citizens and the general public are for the Government and Parliament to define and promote. That is a good statement and one that should be made. It goes on to describe the consumer interest as the regulator’s duty. The most important thing that has come out of this is that the consumer interest should be able to stand aside. The noble Lord, Lord Borrie, and I know this well. We saw these things set up years ago and were worried about the fact that they were captured within some of the regulatory frameworks. Yes, they should be able to have their own representation outside: this is an excellent suggestion. As the noble Lord, Lord Borrie, pointed out, that does not mean that there would be no voice on the governing body of the regulatory body.

On co-operation between regulators, I do not like the sound of that. I like the idea of competition between regulators. The committee recommends that a joint regulators group should be formalised. No, no, no: that sounds expensive, bureaucratic and a bit of a closed shop. I do not like the sound of the cartel of regulators, but it was interesting to read it and interesting to see it. When I think about it, we have looked at some real blue skies thinking here, and I think that there has been a necessary and fundamental shift. The noble Lord, Lord McIntosh, will look back on this work and be extremely proud of it, as he is not today.

I read paragraphs 1.29 and 1.31 and reflected that some 10 years ago, when I was chairing the National Consumer Council—an enormous privilege—we did a piece of work called “Who guards the guards?”. We were worried at that time about who looked after the ombudsmen. What were they doing floating around out there? One or two of them had never been used. We discovered afterwards that the funeral ombudsman had never actually been telephoned. Therefore, with my noble friends Lord Norton and Lord MacGregor, I am keen that a Joint Committee of both Houses of Parliament should regulate the regulators and hold them to account. That is a wonderful suggestion. It is the right suggestion and I hope very much that the Minister will give it a long hard thought.

We would all agree that the dreadful performance of the Financial Services Authority should have been exposed long ago. Sadly, the days have long gone since there was “a regulator” to hold to account. The noble Lord, Lord Borrie, is a shining example of a man who would stand up and take the blame for absolutely everything that happened when he was in charge. He was a lead voice and I sense that the commission that replaced him is not vigorous enough. It is not alert enough and it is not well led. It is glaringly obvious that its members are running themselves like a committee. There is no healthy tension and no real scrutiny. Nobody is guarding those guards and many people in this country have been made wretched by the disgraceful conduct of Northern Rock and the systematic failure of the Financial Services Authority in its duty as a regulator.

The good reputations of all regulatory authorities have over recent times been gradually eroded and the public and industry view of them now is one of mistrust, with such comments as “a cosy billet”, “out of this world”, “process driven” and “neither efficient, economic nor effective”. The FSA is a glaring example of that.

This has been a timely and good piece of work by the best brains in your Lordships' House. Sadly, Lord Garden, who served on the committee, has been lost to us, but by great good fortune, the wisdom, experience and energy of the noble Lord, Lord McIntosh, was kidnapped. The noble Lord has been a fine Minister in this House and his brush with cancer was a worrying time for us all, but here he is today to present this report and, I hope, to carry on to do other Select Committee work.

I ask the Minister to reflect on what she has heard today. I have a whole heap of questions which I was given to ask—lots of snidey little questions and all sorts of stuff that as a good Conservative I should be saying. I have lists and lists of them, but the most important thing that we have heard today is that we want that scrutiny committee of both Houses. We must get that off the ground. This is a marvellous report and I am delighted to have been able to speak to it.

My Lords, I am grateful for this incredibly rich debate. We welcome the report into economic regulators. I understand that my noble friend Lord McIntosh has qualms, but I completely agree with the noble Baroness, Lady Wilcox, that he will be incredibly proud of this report in time. I am very grateful for the dedication and incisiveness of the investigation and the invaluable recommendations. As many noble Lords have noted, this surprisingly is the first cross-cutting look at economic regulation that has considered such a wide range of regulators. It is a very good time to take a step back and see whether the system that has grown up around us somewhat ad hoc is sustainable and suitable for the challenges ahead.

The UK was among the first movers in the area of economic regulation; and yet I believe that the Select Committee report is correct to say that the regime that has been built around the principles of independence, competition and certainty has stood the test of time, despite the reservations caused by recent events. It has adapted to changing circumstances, starting in the post-privatisation period, by encouraging cost efficiency and productivity, competition and consumer protection, as well as investment for future needs.

My noble friend Lord Berkeley and the noble Lord, Lord Bradshaw, commented on the importance of independence, particularly in terms of their experience in the rail sector. Independence is an absolute cornerstone of the regulatory framework. The independence of regulators to make decisions without fear or favour—I echo my noble friend’s words—is central and should continue to be enshrined in everything that we do. We recognise that the powers relating to rail regulation are controversial and this has been debated just this week. We understand the House of Lords Select Committee on the Crossrail Bill is considering petitions that will provide the Government with an opportunity to explore these issues more fully.

One of the central tenets of this area is to provide business certainty. That is essential in terms of new infrastructure and investment. Our regulators have been set up with clearly defined duties which help businesses with the certainty that they need to make long-term decisions. I would simply make one point with reference to the comment of my noble friend Lord Borrie on Ed Balls’s submission to the committee about the interesting relationship between rules-based and principles-based regulation and certainty. It is interesting that small firms take a very different view on rules-based regulation, which they find quite hard, and they often look for simple rules and guidelines to follow. We need to take account of that.

On competition, I was intrigued by the four principles put by the noble Lord, Lord Norton, particularly the third, in which he said that competition reduces the requirement for regulation and, in due course, he could envisage a situation in which it is not necessary at all. I am a very firm believer in markets and have always used them as a central tenet for solving almost every problem. Nevertheless, I do not really believe in perfect markets. I am intrigued by the notion that we can have perfect competition that does not require regulation at all.

Our approach to creating strong and independent regulators has been around the central theme of competition, in order to raise productivity. That is a fundamental objective and although, as the report points out, it is not a primary statutory duty for all regulators, the approach has been successful—as was pointed out by the report with regard to Ofwat. We believe that the RPI-minus-x model that the UK developed incentivises efficient providers and that model has been used or copied across the world—from Australia to Argentina. A lot of visitors come to talk to us about this.

I understand the surprise of my noble friend Lord Berkeley when he expressed concern about Ofwat. Noble Lords might be interested to know that since the report, Ofwat has carried out a wide-ranging review of competition in the water and sewerage industry that was published a month after the report in December. The Government have now asked Professor Martin Cave to carry out an independent review, which will report in the spring of 2009, to consider the scope of water supply, to deliver benefits and drive innovation through developing competition and contestability in all aspects of the water supply chain. In our response to the committee’s report we set out that, when it comes to allocating blame, Parliament’s intention was that the cost principle is retail minus—that was highlighted in the debate on the Water Bill in 2003. Ofwat has recommended the removal of the cost principle from legislation on the grounds that this would enable it to promote competition. We expect that Professor Cave will look at this in his review of the water sector. Consumers are the stakeholders whom we are attempting to protect with the regulatory regime. The report comments on the fact that the requirement to protect consumers is well embedded in statute. We believe that we are delivering, and will continue to deliver, a world-class consumer protection regime. We have announced a review of consumer protection and will be calling for evidence shortly.

I should also mention the new National Consumer Council, which brings together consumer bodies into a single, stronger unit, and our extension of the availability of redress schemes. Some noble Lords have commented sceptically on the effectiveness of this new council, and I have noted those concerns, but we believe that we will have a council that is more open, accountable and effective than its predecessor. Its creation on a statutory basis means that it will be subject to the scrutiny of the NAO and the PAC, and we will be looking at it ourselves in due course.

I understand the strength of feeling about the question of who is regulating the regulators. I completely agree with, and was struck by, the point made by the noble Lord, Lord Norton, about the importance of comparative scrutiny in ensuring that we have an effective system of regulation. We do not wish to compromise the independence of regulators in any way, and there are existing scrutiny mechanisms, including departmental Select Committees and appeals to Competition Commission tribunal judicial reviews. But I understand the strength of feeling. I know the lines in my brief. It states that, “It is obviously not for us to comment on the necessity of a new committee, which is a matter for Parliament”. Nevertheless, while I cannot be prescriptive about the form of effective scrutiny that might be put in place, I would strongly endorse and support some form of extra scrutiny for a collective and comparative look at regulators.

There was a lot of discussion about impact assessments and post-implementation reviews. I know that the noble Baroness, Lady Wilcox, is very attached to those ideas. The Select Committee correctly highlights the need for regulators to use better cost-benefit analyses in their impact assessments and to make these documents much more easily accessible. We cannot direct them to do this, because of their independence, but we fully support those recommendations and would strongly encourage regulators to follow them. A similar need was expressed for the post-implementation evaluation of policies. We now require that those are set out. When you do the impact assessment, you need to set out when you are going to do the post-implementation review. It is a key tool and we strongly support it. Noble Lords will be interested to know that my right honourable friend the Leader of another place recently wrote to the Cabinet on new measures to implement post-legislative scrutiny of Acts that received Royal Assent from 2005 onwards. This will involve all departments producing memoranda on the effectiveness and impact of legislation that has been introduced. These memoranda will be considered by the respective departmental Select Committees, which will decide whether to conduct post-legislative scrutiny on the Act. Again, although the committees do not cover the independent regulators and are limited in scope in terms of advising or directing them, we strongly urge them to consider how they can apply these reviews in their own circumstances.

I was also very struck by the comments relating to co-ordination. I fully endorse the view of the noble Baroness, Lady Wilcox, that there should not be a super-regulator in any shape or form, but I accept that there is a need for better co-ordination. We hope that the Joint Regulators’ Group—which is just a group; it is not a new super-regulator—will ensure that co-ordination is improved.

We have carefully considered the case for a central point in Whitehall to deal with economic regulatory policy in the round. I have to admit to being quite cautious. I do not wish to create a new bureaucratic unit to co-ordinate these issues just because there is no obvious home in Whitehall. We certainly do not wish to create a body that would appear to compromise the independence of regulators. Therefore, my department is considering whether the Better Regulation Executive would be a good home for this task to be taken in hand and we are currently looking at its terms of reference. I hope that it will help with the problems of ministerial co-ordination that were raised. There is an inter-ministerial panel for regulatory accountability, and I shall definitely have to take away from this debate the need to revive it and put some vigour into it.

I should also like to comment on reducing regulatory burdens on business where they are unnecessary. My noble friend Lord Berkeley mentioned the Bill that we have all been working on. I am very grateful for his comments of support, together with those of my noble friend Lord Borrie, and for the improvements that we have made to the Bill as a result. We believed it was very important to state in the Bill that some of the economic regulators should have a duty to ensure that they do not impose unnecessary regulatory burdens, given the significant impact that they have on the economy.

I turn to some of the more topical issues that have dominated the debate. Despite those issues, I do not believe that the underlying strength of the regulatory principles and system or our position as a world leader in the regulatory field is altered. Therefore, I accept the view of the noble Lord, Lord MacGregor, that mistakes do not invalidate good principles, and I do not accept my noble friend’s view that somehow the regime has been invalidated.

Clearly, we are facing a very difficult time in terms of the international financial markets, but it is important to remember that this is the single most globalised sector. Capital flows and the financial institutions are international but the regulators are national, and therefore this matter cannot be dealt with simply by national regulators. The regulation of credit rating agencies, which was mentioned, or understanding the flow of derivatives and the risks that are transferred with those derivatives, for example, are not matters that a national regulator can remotely deal with on its own.

I do indeed remember the dinner where Alan Greenspan spoke about the fact that derivatives in themselves reduce risk. I simply quote something that Alan Greenspan has often been known to say:

“If I seem unduly clear to you, you must have misunderstood what I said”.

That sums up the position with derivatives.

I do not think that the case of Northern Rock undermines the argument for better regulation and the proportionate approach that we have all been discussing and promoting. Mistakes, as I say, do not invalidate good principles. I have read Richard Lambert’s speech and very much accept his view that we should not have any knee-jerk reaction.

The FSA acknowledged in its report published last week that its supervision of Northern Rock was not of sufficient intensity or appropriate rigour to challenge the company’s risk management practices and understanding of the risks posed by the business model that Northern Rock chose to pursue. The FSA accepted the conclusions and recommendations on improvements and steps are now being taken to strengthen the overall supervisory process.

As for the regulatory architecture, the Treasury Select Committee endorsed the view that the UK’s tripartite framework for financial stability—with a single regulator undertaking principles-based regulation — remains right. However, there is no room for complacency and we need to clearly address issues thrown up by recent events.

Later this year, we plan to bring forward legislation to introduce a package of reforms, which are currently being consulted on. For example, we propose to give the FSA an additional power to collect information from banks at short notice. The consultation document also proposes giving the Bank of England a statutory role on financial stability. There are also other changes to the Bank of England’s governance arrangements.

This debate, as much as the report, has given me enormous food for thought and a new agenda, certainly in understanding the cross-Whitehall collective view of economic regulation. It has also given me some views on the role that my department could play. I am very grateful for all the suggestions and comments that have been made. I apologise if I have not answered all of them; those that I have not, I will do so in writing.

My Lords, noble Lords would not thank me for detaining them at a time when they are anxious for the House to rise so that they can leave for a couple of weeks, so I will not do that. The classic job of the mover of the Motion in winding up is to defend the report and the committee’s work. I do not need to do that as there has been no attack on them. Indeed, some speakers, such as the noble Baroness, Lady Wilcox, have gone quite a long way in the opposite direction of praising us and our work.

I am not and was not saying that we did not do a decent job in the circumstances that we faced. On the whole, we got the right evidence for the time and assessed and reported on it properly. That was not my complaint. Rather, my complaint was purely selfish. I would have had even more fun—because I enjoyed doing it—if I had been able to produce a report that had taken into account the events of the subsequent six months.

Let me thank, in particular, the noble Baroness, Lady Vadera, for going just a little bit beyond her brief in her support for a sessional or Joint Committee. She is quite right. Her lines to take were, of course, correct, but she showed some personal understanding of the need for this work and I am grateful to her for that. Let me also thank her for what she said about ministerial responsibility and the need for better co-ordination, because this is a cross-governmental issue. We do not want more bureaucracy in government but we want this issue to be taken with the seriousness that it deserves, which cannot be done on a piecemeal basis by departmental Select Committees.

Let me make it clear that, although I have criticised particular failures of financial regulation—I am doing no more than the FSA did itself, after all—it is not my assertion that the financial regulation system or the regulatory system is broken as a whole. I believe that there have been cracks and it is important to put those things right. My complaint was that the financial markets were at fault; that should have been seen by a lot of people much earlier than it was.

I am a great believer in anti-aphorisms; as Bernard Shaw said, if a thing is worth doing, it is worth doing badly. He was referring, I think, to amateur piano-playing. My anti-aphorism here is that a trouble shared is a trouble doubled; in other words, if you spread the risk, as the Bank of England said a year ago, you lose clarity about who is responsible and you create new risks rather than eliminate them. We have had a terrible lesson in that in the past few months. I rely on the regulatory state in this country to improve the protection that the people of this country have a right to expect against such abuse.

I have one bit of thanks; that is, to thank the noble Lords, Lord MacGregor, Lord Norton and Lord Ramsbotham, for taking the chair for a period in which I was having a heart operation. They performed the role marvellously well and I am very grateful to them.

On Question, Motion agreed to.

House adjourned at 6.41 pm.